Innovative portfolio, India market to drive growth
India’s largest drugmaker Sun Pharma will announce its results for the third quarter of the financial year on Saturday. While brokerage firms expect steady domestic growth and marginal sequential growth in their U.S. business, driven by innovative pharmaceuticals, margins could tighten due to increased expenses.
Analysts will also be seeking clarity on the possible impact of the US government’s most preferred nation (MFN) pricing norms and the company’s plans after it received regulatory approval to market semaglutide as a weight loss drug in India earlier this month.
Kotak Institutional Equities analysts said in a Jan. 6 note that Sun Pharma’s overall sales were expected to increase 5% annually (down 1% sequentially), while U.S. sales fell 4% sequentially to $478 million due to declines in sales of its blood cancer drug Revlimid.
Sun Pharma is one of several Indian drugmakers that has signed a deal with Mylan, the inventor of Revlimid, to sell the drug in limited quantities from 2022 until its patent expires in January 2026. Lower Revlimid sales are expected to reduce earnings for many U.S.-focused drugmakers this quarter as they are expected to clear remaining inventories.
innovative pillow
However, Sun’s portfolio of innovative drugs could offset this decline. Last quarter, innovative sales surpassed generic sales in the U.S. for the first time. Increased sales of the alopecia area medicine Leqselvi, which launched in the U.S. in June 2025, as well as continued growth in other drugs such as Cequa, Winlevi, and Odomzo, are expected to increase U.S. formulations and global specialty sales.
Sun Pharma is also expected to post steady domestic growth of 11-13%, according to brokerage firms Kotak, BNP Paribas and HDFC Securities. This will outpace the overall Indian pharma market, which grew by 10.1% in October-November 2025, according to IQVIA.
EBITDA margin may remain flat or decline due to increased marketing costs. Management had announced a $100 million investment to market its new specialty drugs, Leqselvi and Unloxyt, in FY26.
Eyes on MFN, semaglutide
All eyes will be on the administration’s comments on the US government’s MFN drug pricing norms, said a pharmaceutical analyst who requested anonymity because he was not authorized to speak to the media.
Under MFN drug pricing norms, drug manufacturers are required to match the lowest price offered for a drug in other developed countries. This is part of the Trump administration’s effort to make health care cheaper for Americans. The government made agreements on this issue with manufacturers such as Pfizer, AstraZeneca and Merck last year. Sun Pharma’s presence in the US innovation market means it could be affected by these measures.
In December, the Centers for Medicare and Medicaid Services (CMS) released pricing initiatives to incorporate MFN pricing into the Medicare Part B and D programs. If finalized, manufacturers will be required to pay additional mandatory rebates on drugs covered by these programs.
Sun Pharma also announced in January that it had received regulatory approval to launch semaglutide for weight management in India after its patent expired in March.
In the second quarter of 2026, the company beat Street forecasts with net profit up 2.6% year-on-year. ₹3,117.95 crore and revenue from operations up 8.6% YoY ₹14,405.2 crore.
The company has recorded steady revenue growth in most markets. Generic sales fell, but this was offset by growth in the company’s innovative portfolio. EBITDA for the quarter ₹4,527 crore, an increase of 14.9%, while the margin increased to 31.3% from 29.6% in the previous year.
