Sun Pharma (Sun) is acquiring US-based early-stage oncology-focused biotech company Checkpoint Therapeutics. Checkpoint’s lead anti-PD-L1 drug Unloxcyt (cosibelimab) is approved by the USFDA for treatment of adults with metastatic or locally advanced cutaneous squamous cell carcinoma (cSCC) cSCC is the second most common form of skin cancer with ~1mn new cases detected every year (including 40,000 advance stage cases) At end-Q3FY25, Sun had net cash balance of USD 3bn, which may be used to fund this transaction. Post-acquisition, Sun is likely to pay royalties (~4.5% of sales) to Fortress for a defined period. We upgrade our rating on the stock to BUY (earlier Hold) with a higher target price of INR 1,895, based on 31x FY27E EPS (32x on FY26E EPS earlier). For all recommendations report, click here.