Shares of Glenmark Pharmaceuticals surged 14% to an all-time high on Friday after its biotechnology unit, Ichnos Glenmark Innovation (IGI), signed a landmark licensing deal with US drugmaker AbbVie for its experimental blood cancer drug, ISB 2001.
The agreement, announced late Thursday, marks one of the largest biotechnology licensing deals by an Indian company to date.
The stock was the top gainer on the Nifty Pharma index, which was up 0.67% even as the benchmark Nifty 50 fell 0.8%.
Analysts and investors hailed the deal as a transformative moment for Glenmark’s innovation platform and its financial outlook.
Analysts bullish on ‘record-breaking deal in Indian biotech’
Under the terms of the agreement, AbbVie will receive exclusive global rights to develop and commercialise ISB 2001 in North America, Europe, Japan, and Greater China.
IGI will receive a $700 million upfront payment and up to $1.22 billion in future milestone payments.
AbbVie has also committed to paying double-digit royalties on future sales.
“This is possibly the biggest deal by an Indian company in the biotechnology space,” said Shrikant Akolkar, an analyst at brokerage Nuvama.
Motilal Oswal raised its target price on Glenmark shares to Rs 2,430 from Rs 1,690, the most bullish among analysts tracked by LSEG.
Analysts, on average, rate the stock “buy”, with the median price target at Rs 1,665, well below current levels of Rs 2,171.70, which means a re-rating is likely.
“With $2 billion in deal value and double-digit royalties, AbbVie’s implied peak sales estimate for this molecule is likely $5 to 6 billion,” said Vishal Manchanda, pharma analyst at Systematix.
“If the drug delivers, Glenmark could earn over $500 million in annual royalties — more than its current consolidated EBITDA,” he added.
Manchanda also noted that the deal’s scale is unusually large for a Phase 1 molecule, even by international benchmarks.
He expects the drug to reach commercialisation within three years, with peak sales likely in six to seven years.
IGI postpones IPO plans, gains financial runway
As part of its post-deal commentary, Glenmark said there was now no urgency to pursue an IPO for IGI, a move it had earlier considered to fund R&D.
With the upfront payment in hand, IGI now has sufficient resources to support its estimated annual research spend of $70 million over the next three years.
IGI will retain the majority of the cash, pay a modest dividend to Glenmark, and avoid major debt reduction, given its relatively clean balance sheet.
“This makes the IGI platform self-sustaining,” said Vineet Gala, an independent pharma analyst.
“For years, Glenmark was funding it through leverage and internal cash flows. This removes that pressure, and shifts the story from ‘R&D on debt’ to a monetizable innovation pipeline,” he added.
The broader implications of the AbbVie deal stretch beyond its financial terms.
Glenmark’s innovation pipeline, housed in IGI, had seen intangibles swell to nearly Rs 4,500 crore over the past two years.
The licensing of ISB 2001—a T-cell engager for solid tumors—validates that investment and provides a model for capital-light biotech development from India.
“This is de-risking on all fronts—funding, balance sheet, and IPO timelines,” said Gala. “The innovation engine is finally capitalised.”
Glenmark touches upper circuit as market recalibrates the company’s future
Following the announcement, Glenmark closed nearly 5% higher on July 10 and touched the upper circuit on July 11.
The company is now the best performer on the Nifty Pharma index for 2025, with a more than 34% year-to-date gain, compared to a 5.2% decline for the index.
Brokerages such as Nomura expect IGI to ramp up its R&D spending, thanks to the deal’s funding cushion.
Glenmark is expected to provide further updates on its pipeline at its upcoming Analyst Day on July 16.
Analysts believe there may be two to three more molecules in development at IGI that could follow a similar licensing model.
“The company has run up in anticipation, but there’s still more room if the innovation roadmap becomes credible,” said Gala.
While analysts remain divided on whether the stock has already priced in the deal’s upside, most agree that Glenmark has crossed an inflection point.
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