Zydus wins FDA nod for DMD drug Jaythari—what it means for rare disease treatment and its stock

What is Zydus Lifesciences’ latest USFDA approval and why is it important?

Zydus Lifesciences Limited has announced final approval from the United States Food and Drug Administration (USFDA) for the manufacture and marketing of Jaythari (Deflazacort) tablets in strengths of 6 mg, 18 mg, 30 mg, and 36 mg. Jaythari is the generic version of Emflaza, approved for the treatment of Duchenne muscular dystrophy (DMD) in patients aged five years and older. The approval enables Zydus to enter a specialised therapeutic space, significantly strengthening its U.S. portfolio and widening its reach in rare disease treatment.

DMD is a rare genetic condition with high unmet medical need, and the introduction of Jaythari is expected to enhance accessibility and affordability of long-term corticosteroid therapy for affected individuals. The approved tablets will be manufactured at Doppel Farmaceutici S.r.l., Italy—Zydus’ European production partner.

How does Jaythari (Deflazacort) support patients living with Duchenne muscular dystrophy?

Jaythari (Deflazacort) is a corticosteroid that plays a key role in managing Duchenne muscular dystrophy, a degenerative muscle disorder primarily affecting young boys. The drug helps slow the progression of muscle weakness by reducing inflammation and modulating the immune response. In clinical settings, Deflazacort has shown favourable outcomes compared to other corticosteroids like prednisone, especially in terms of side effect management and tolerability in paediatric populations.

DMD leads to loss of ambulation, respiratory complications, and premature death, typically by early adulthood. With limited disease-modifying therapies available, long-term corticosteroids like Jaythari serve as a cornerstone in disease management. By offering this treatment in multiple dosage forms, Zydus enables physicians to better tailor care to individual patient needs.

What does this approval mean for Zydus’ U.S. growth strategy?

The USFDA’s nod for Jaythari adds to the company’s tally of 424 ANDA (Abbreviated New Drug Application) approvals, out of a total of 492 filings since the process began in FY 2003-04. The rare disease segment has emerged as a strategic priority for Zydus as it pivots from volume-led growth to innovation-led therapeutics.

The approval reflects Zydus’ ability to develop complex generics that meet stringent U.S. regulatory standards. With Jaythari, the company is not only building commercial value in a niche market but also reinforcing its identity as a quality-driven global generics leader. The launch comes amid growing scrutiny over drug pricing in the U.S., where Zydus can play a role in lowering costs through competitive, high-quality alternatives.

What is the financial and market potential for Jaythari in the United States?

Although Duchenne muscular dystrophy affects a relatively small patient population, drugs in this category often carry orphan designation and command premium pricing. Emflaza, the branded version of Deflazacort, was originally launched at a high annual cost exceeding $35,000 per patient. This has created a favourable market for generics, especially those backed by reliable supply chains and compliant manufacturing facilities.

Jaythari’s entry is expected to increase competition in the corticosteroid segment for rare diseases, potentially leading to more accessible pricing and broader adoption. Demand is expected to remain steady, supported by improved diagnostics and early intervention programs. For Zydus, this could translate into consistent U.S. revenue contributions from a high-margin product class.

How is Zydus Lifesciences stock performing after the Jaythari approval?

On April 11, 2025, the day the approval was announced, shares of Zydus Lifesciences (NSE: ZYDUSLIFE) closed 2.90% higher at ₹868.85. Despite this positive movement, the stock has declined 10.58% year-to-date and is down 3.66% over the past five sessions. The 52-week trading range spans from ₹797.05 to ₹1,323.90, reflecting a high degree of volatility in investor sentiment.

Financially, the company reported a net profit of ₹1,026.20 crore for the quarter ended December 31, 2024, driven by a 31% year-on-year increase in U.S. sales. The U.S. market now contributes nearly half—47%—of the company’s total revenue, underscoring its critical role in earnings performance.

Zydus’ trailing twelve-month P/E ratio of 19.29 remains below the sector average of 28.33, indicating potential undervaluation. With 27 analysts covering the stock, sentiment remains mixed: 3 strong buy, 9 buy, 10 hold, and 3 sell recommendations have been reported. The median 12-month price target stands at ₹1,063.61, implying an upside of nearly 22% from current levels.

Should investors consider buying Zydus Lifesciences stock?

The Jaythari approval acts as a strong catalyst for long-term investors focused on pharmaceutical innovation and specialty drugs. With U.S. sales rising and a strong ANDA pipeline, Zydus is well-positioned to deliver sustainable growth. The rare disease segment, while smaller in volume, offers high-value opportunities where the company can leverage its R&D and regulatory capabilities.

Given the company’s healthy financial metrics, improving U.S. visibility, and strategic investments in rare disease therapeutics, investors may consider a ‘Buy’ rating, particularly if the stock consolidates around the ₹850–₹870 range. However, it remains important to monitor the company’s ability to convert regulatory approvals into consistent commercial performance in the face of competition and price erosion.

How does Zydus’ approach to manufacturing bolster its global operations?

Jaythari will be produced at Doppel Farmaceutici S.r.l., Italy, highlighting Zydus’ manufacturing partnerships beyond India. By leveraging global manufacturing hubs, Zydus ensures supply chain resilience, meets regulatory compliance across geographies, and minimises country-specific operational risks. This approach is aligned with industry-wide trends post-COVID-19, where companies are increasingly opting for diversified production ecosystems to mitigate future disruptions.

What does Jaythari’s launch indicate for rare disease innovation?

Jaythari’s regulatory clearance reaffirms Zydus Lifesciences’ intent to expand into underserved segments like rare diseases, where drug availability remains limited. While blockbuster drugs dominate volume charts, innovation in orphan therapies is crucial for building a future-ready pharmaceutical portfolio. Zydus’ continued efforts in this direction reflect a larger trend of Indian companies entering the high-science, high-regulation territory of rare disease care.

As global health systems increasingly advocate for equitable access to rare disease drugs, companies offering competitively priced, quality-driven generics like Jaythari are likely to find strong footing. The convergence of scientific progress, policy support, and commercial viability in this segment will be pivotal in shaping the next wave of growth in global pharma.