Pharma major Lupin on Thursday said it has agreed to acquire US-based, privately-held Gavis Pharmaceuticals LLC and Novel Laboratories Inc, in a transaction valued at $880 million.
The cash-free and debt-free transaction has been unanimously approved by the boards of Lupin and GAVIS and will enhance Lupin’s scale in the US generic market while widening the Mumbai-based company’s pipeline in dermatology, controlled substance products and other high-value and niche generics.
The acquisition creates the 5th largest portfolio of ANDA filings with the US FDA, addressing a $63.8 billion market.
Commenting on the acquisition, Lupin chief executive Vinita Gupta said, "This is a pivotal acquisition for Lupin as it aligns with our goal to expand and deepen our US presence. GAVIS has a strong track record of delivering highly differentiated products in a short time and is poised for continued growth as it delivers on its existing pipeline. GAVIS’s capabilities and pipeline are an excellent complement to Lupin.”
Among the immediate benefits from the Gavis acquisition is a highly-skilled US based R and D organization complementing Lupin’s Coral Springs, Florida, inhalation R and D center.
Gavis recorded sales of $96 million in FY 2014 and has over 250 New Jersey based employees. Gavis currently has 66 ANDA filings pending approval with the US FDA and a pipeline of over 65+ products under development. 72% of these filings pending approvals represent niche dosage forms.
Under the transaction, Gavis’s New Jersey manufacturing facility will become Lupin’s first manufacturing site in the US. GAVIS specializes in formulation development, manufacturing, packaging, sales, marketing, and distribution of pharmaceuticals products.
The US company’s pending filings address a market value of about $9 billion and the combined company will have a portfolio of 101 in-market products, 164 cumulative filings pending approval and a deep pipeline of products under development for the US.
The acquisition will also accelerate Lupin’s entry into niche areas like controlled substances and dermatology. “The acquisition is expected to be accretive to the earnings from the first full year of operations. In addition to the compelling strategic fit, there is a strong cultural fit between Gavis and Lupin’s entrepreneurial spirit and values,” said Gupta.
Gavis founder and CEO Veerappan Subramanian said: “This is a time of globalization for the specialty pharmaceutical industry and GAVIS is well positioned to capitalize on this exciting opportunity. Joining forces with Lupin will help realize our vision of building a broader, research-based high value, specialty business through organic growth. I am confident the combined entity will be a powerhouse in the US specialty space and will significantly enhance Lupin’s US platform.”