KUALA LUMPUR (Feb 7): IHH Healthcare Bhd’s (KL:IHH) legal battle against Daiichi Sankyo Co Ltd remains far from certain, though an expert report calling for higher claim could tip the case in the hospital operator's favour, according to MIDF Amanah Investment Bank.

While the outcome remains unpredictable, the higher damage claim sought may indicate a strong belief in the validity of IHH Healthcare’s case against the Japanese pharmaceutical company, the research house said in a note.

However, the complexity of the case “might also influence the judicial decisions on whether the compensation estimated on losses suffered is agreeable”, MIDF flagged.

On Thursday, IHH Healthcare said it is seeking up to 109.3 billion Indian rupees (RM5.7 billion) as compensation from Daiichi Sankyo for stalling its acquisition of shares in India’s Fortis Healthcare.

The compensation, based on a report by consultant Osborne Partners that is submitted to the Tokyo District Court, is much higher than the initial claim of ¥20 billion (RM653 million), together with interest at a rate of 3% per annum, filed against Daiichi Sankyo in November 2023.

MIDF identified four scenarios that could unfold from the case. A full victory for IHH Healthcare would result in a substantial one-off gain and boost investor confidence, though a loss would result in additional legal costs and negative market reaction.

The involved parties could also opt to settle out of court ahead of a verdict, which would involve additional negotiations and a lower compensation amount in exchange for a shorter litigation process, MIDF said.

“A partial victory is also possible, wherein the court favours IHH but awards a lower compensation amount than claimed, which gives the required financial relief but without covering the full damage claims,” the research house added.

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IHH’s unit seeks up to RM5.7 bil in compensation from Japan’s Daiichi Sankyo over Fortis deal