CDMO stocks Divi’s Labs, Laurus, Piramal Pharma surge up to 5% after US Senate passes NDAA Bill

Shares of Pharma companies, Divi’s Laboratories, Syngene, Laurus Labs, Piramal Pharma, and Blue Jet Healthcare, surged up to 5% on Friday, October 10, after the US senate passed the National Defence Authorisation Act (NDAA).77 votes in favour of the act, while 20 votes were cast against the motion.

The Biosecure Act aims to prohibit federal funding for Chinese biotech companies deemed as “biotechnology companies of concern.’ The amended Biosecure Act prohibits the use of “biotechnology equipment or services” from any “biotechnology company of concern” (BCC) in Federal contracts.

According to brokerage firm Macquarie, the NDAA bill embedded an amended version of the US Biosecure Act, which was also passed along with the NDAA.

The brokerage added that the prohibitions outlined in the Biosecure Act will take effect with respect to these entities, 60 days following the revision of the Federal Acquisition Regulation, pertaining to these companies.

Indian companies believe that the Contract Manufacturing or the CRDMO industry could triple or quadruple in size in the next four to five years.CDMO companies in India have already seeing growth based on the possibility of the Biosecure Act stating that companies have not considered India are now looking at India.

Macquarie has reiterated its “outperform” rating on Divi’s Laboratories, Cohance, Syngene, and Blue Jet Healthcare.

Shares of Blue Jet Healthcare are trading with gains of 4.6% at ₹683.55. The stock is down 2.1% in the last one month.

Shares of Syngene are trading 2.3% higher at ₹653.25. The stock has been flat in the last one month.

Shares of Laurus Labs are trading 2.6% higher at ₹887.65. The stock has also remained flat in the last one month.

Shares of Divi’s Laboratories surged as much as 4.5% to ₹6,411. The stock has risen 6.3% in the last one month.