Pharma firms look at buying niche product portfolios

MUMBAI: Cash-rich pharmaceutical firms in India are now looking at acquisition of niche product portfolios in regulated markets, a report said on Tuesday.

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“Recently, select innovators have taken a call to exit their generics business and concentrate on patented businesses creating billion dollar acquisition opportunities for large Indian pharma players in the regulated markets,” said the report by broking firm ICICI Securities.

The larger players, essentially the top 10 pharma companies, are extremely cash rich and are hungry to acquire companies with niche portfolios, the report said.

UCB sold its generics arm Kremers Urban to Lannett for $1.23 billion last September and its generics portfolio in India to Dr Reddy’s. Similarly, Boeringer Ingelheim sold its generic arm Roxanne Laboratories to Jordan-based Hikma Pharmaceuticals for $2.65 billion.

The acquisition of Allergan’s Generics business by Teva recently triggered the sale of certain products in USA and Europe on account of competition commission. Dr Reddy’s also acquired a portfolio of eight ANDAs (abbreviated new drug applications) for $350 million, while Zydus bought two ANDAs for an undisclosed amount.

The activity is not limited to the US alone. A couple of Indian companies are in the fray to acquire Teva’s generics portfolio in Europe reported to be worth $1-1.5 billion. Sun Pharma and Lupin recently acquired a portfolio of brands in Japan from Novartis and Shionogi.