The stock of Suven Lifesciences got a shot in the arm after the pharmaceutical firm announced its eighth product patent in Australia and Mexico for its new chemical entities. The stock gained 9.56% or Rs 2.80 to close at Rs 32.10. It touched an intraday high of Rs 32.75 and an intraday low of Rs 29. There were pending buy orders of 1,128 shares, with no sellers available.Why the run-up?
The company secured two product patents, one each in Australia and Mexico, for a new chemical entity to treat disorders associated with neuro-degenerative diseases. The patents in Australia and Mexico will be valid till 2023 and 2025 respectively.
The company with its pipeline of molecules that it is developing in the central nervous system arena for cognitive disorders is eyeing an estimated USD 30 billion potential global market.
Back in May, the company had received a patent for new neuro molecules, from Canada and Eurasia. The contract reserach and manufacturing services provider received the Canadian and Eurasian patents for new chemical compounds with the potential to treat several neurodegenerative diseases including Alzheimer's.
In April, Suven Life’s investigative 5-HT compounds won patents from New Zealand and India, while in March, it secured another patent from the European Patent Office for a lead molecule with the potential to treat neurodegenerative diseases.
The company is looking to raise USD 20 million by the end of fiscal year 2011 to fund its research activities and could consider diluting stake. Speaking on the company's fund raising plans, Venkat Jasti, CEO of Suven Life Sciences had told on August 27, "We have brought 13 molecules to the table. But when it comes to development and clinical trials, and this is for SUVN-502, we need to spend about USD 20 million, for which we don’t have cash on hand. We will be raising that at the end of the year."
Also read: Will raise $20 million by year-end: Suven Life Sciences
The company had signed an agreement with Eli Lilly back in 2008, according to which the company would receive research funding as well as potential discovery and development milestone payments in the range of USD 19 million to USD 23 million per candidate and potential royalties on net sales of any products that may be successfully commercialized from the collaboration.
