Glenmark Pharma hits a new high

Glenmark Pharma is amongst the top gainers on the BSE currently, up 6% at Rs.894 and it briefly crossed Rs.900, hitting a new 52-week high at Rs.901.20.

Many things going for the company. The Cabinet Committee on Economic Affairs (CCEA) allowed the company yesterday to increase the FII limit in the company from 35.07% to 49% and this is expected to result in an inflow of Rs.2022 crore.

Yesterday, it also received final ANDA approval for Norethindrone Acetate and Ethinyl Estradiol Tablets USP, 0.5 mg/2.5 mcg and 1mg/5 mcg and the company is expected to commence distribution immediately.

And today morning, the company announced that its US subsidiary has concluded the pricing investigation by the Texas Attorney General, USA. Under the terms of the agreed settlement, there is no admission of liability. Glenmark Generics will make a payment in 16 equal payments of $1.56 mn each quarter for the next 16 quarters to the state of Texas. This is not expected to have any material impact on the company’s cashflow.

Under the settlement agreement, Glenmark must pay the State of Texas a total of $11.25 million for the State's general revenue fund. Because the Medicaid program is jointly funded by the State and U.S taxpayers, the federal government is entitled to a percentage of the settlement proceeds. The federal government's share is also $11.25 million. Additionally, the Texas Attorney General's Office will receive $2.5 million in attorneys' fees and costs.

But at the end of so many news, what really mattered the most to the market was the increase in FII limit and that news alone pushed the price to a new high.