After a 'Favulous' week, investors dump this smallcap drug maker

NEW DELHI: Vivimed Labs, a Hyderabad-based drug maker with a market cap of Rs 260 crore, has had an interesting week.

On May 10, it received government approval to manufacture Favipiravir, which lifted its share price up 27 per cent within just 4 sessions. However, it didn’t take much to turn the tides against it.

As Covid-19 cases decline gradually, investors are now running away from the counter. On Monday, the scrip hit the 5 per cent lower circuit at Rs 31.20. Investors believe that with the decline in cases, the demand for Favipiravir will also come down.

Favipiravir is used for the treatment of mild to moderate cases of Covid-19. It is one of the leading oral anti-viral treatment approved in various countries for the potential treatment of Covid-19 patients.

In fact, in April, another version of this drug was the top selling one in India. Reports say Glenmark’s FabiFlu catapulted to capture the number one slot in the domestic pharma market in April – from 169th in February. The company sold Rs 352 crore worth of the drug in April, accounting for over 2 per cent of the total domestic pharma market sales of Rs 15,662 crore.

Vivimed had launched the drug with the brand name of Favulous.

“With a huge spike in Covid-19 cases being reported daily in India, there is an urgent need to provide more treatment options to healthcare professionals. We are launching ‘Favulous’ at a competitive price to make the drug accessible to more and more patients thereby ensuring good health and reducing their financial burden,” said Ramesh Krishnamurthy, CEO of Vivimed Labs, last week.

But, now there are questions on how much the company can capitalise on the opportunity, though caseload in the country still remains one of the highest in the world.

Daily cases of Covid-19 in India continued to fall after hitting a peak last week. India recorded 2,81,683 new Covid-19 cases until 11.53 pm on May 16, while 4,092 new deaths were also registered. The country has so far reported 2,49,64,925 cases and 2,74,411 deaths.