Cipla Ltd. shares jumped over 10% in early trading on Thursday after the USFDA classified its Goa facility as a “Voluntary Action Indicated” (VAI) status.

The Goa facility was earlier re-inspected by the regulator between June 10 – June 21, 2024, post which, six observations were issued.

The VAi status now paves the way for key niche launches like the Abraxane generic.

Abraxane is a paclitaxel-based chemotherapy drug used to treat cancer with a market size of over $700 million. Currently only one generic player, Sandoz, has received approval in October 2024.
Brokerage firm Citi said that the generic Abraxane is a key product from Cipla’s Goa facility.

With this clearance, Citi said that there is a possibility of the generic Abraxane can be launched in the current financial year itself, compared to earlier expectations of a delay until financial year 2026 – 2027.

The brokerage has built in $24 million to $48 million of sales for product into financial year 2026 and 2027, which can go up by $25 million to $40 million.

The development once again improves pipeline visibility for Cipla, Citi wrote in its note. Citi has a “buy” recommendation on Cipla, with a price target of ₹1,830.

Out of the 38 analysts that have coverage on Cipla, 21 of them have a “buy” rating on the stock, eight of them said “hold”, while nine of them have a “sell” rating on the stock.

Shares of Cipla are currently trading 8% higher on Thursday at ₹1,528. The stock is up 22% so far on 2024.