Shares of Alkem Laboratories were gaining on Monday after the pharma major signed a deal with a Swedish firm for a treatment related to fungal diseases.

What Happened: Alkem Laboratories is joining hands with Sweden’s Biosergen AB to co-develop and license BSG005, a treatment for severe and stubborn invasive fungal diseases, the firms said in a press release on Sunday. The collaboration will see the duo conducting phase II and III trials of the innovative drug and bring it to India.

India, which has one of the highest rates of life-threatening fungal infections, will host the first patient trial. The trial will enrol patients suffering from severe fungal diseases that are resistant or intolerant to the standard treatment, Amphotericin B.

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What Happens Next: Alkem will manage the initial clinical trial, which is set to kick off as soon as it receives regulatory approval.

Following successful trials in India, the partnership hopes to extend the usage of BSG005 to similar patient groups in the US and EU markets.

As part of the deal, Alkem will invest in BSG005’s clinical development and will receive an exclusive license to market the product in India. The agreement aligns strategically with Alkem’s significant presence in the acute care segment, particularly in hospital-based treatment.

Alkem had recently confirmed that the Income Tax Department had conducted a survey at some of its offices and subsidiaries. The firm said in an exchange filing that the development would have no impact on the company's operations.

Price Action: Alkem’s share price was up 0.69% at ₹3,575.00 in afternoon trade on Monday.

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