January 17, 2019
Aurobindo will pay an upfront purchase price of US$160 million, along with additional payment of US$140 million on reaching certain regulatory and sales-based milestones
The deal is in line with Aurobindo’s strategy to expand in the US. Last year, Aurobindo acquired Sandoz US’ dermatology and oral medicines businesses for US$900 million
Leading Indian pharma manufacturers such as Sun Pharmaceuticals, Lupin, Dr Reddy's Laboratories, Cipla, Aurobindo Pharma have made a name for themselves globally
India’s pharma sector was valued at US$33 billion in 2017 and is touted to grow over 2015–20 to reach US$55 billion; The sector saw acquisitions worth over US$2.1 billion last year
India’s Aurobindo Pharma announced an agreement on January 17 to buy a portfolio of 7 FDA-approved branded hematology/oncology drugs from US-based Spectrum Pharmaceuticalss. The marketed injectable drugs will be taken over by Aurobindo Pharma’s New Jersey-based subsidiary Acrotech Biopharma. The Indian drugmaker will pay an upfront purchase price of US$160 million, along with additional payment of US$140 million on reaching certain regulatory and sales-based milestones. The acquisition also brings in an experienced branded commercial infrastructure in the US. Aurobindo expects the portfolio to create revenue of around US$100 million during the first 12 months of deal closing.
Aurobindo said that the acquisition will help it enter branded oncology market with a range of products that are well recognized. Aurobindo Group will also acquire a well-established and experienced branded commercial infrastructure to continue commercializing these brands. The deal is in line with Aurobindo’s strategy to expand its business in the US. Last year, Aurobindo had acquired Sandoz US’ dermatology and oral medicines businesses for US$900 million. The products being dealt upon now generated total sales of US$76.4 million in the first nine months of 2018. With the sale, Spectrum will focus on novel oncology drug development and commercialization, namely two late-stage pipeline assets.
The Indian pharmaceutical sector has seen a wave of mergers and acquisitions that were valued at more than US$2.1 billion last year. India, today, is the largest provider of generic drugs globally – supplying 50 per cent of vaccines and meeting over 40 per cent of the US demand for generics. In addition, it supplies about 25 per cent of all medicines in the UK. The high-margin and high-precision sector is exporting most of the drugs at lower prices across the globe. India’s pharma sector was valued at US$33 billion in 2017 and is expected to grow over 2015–20 to reach US$55 billion. Meanwhile, pharmaceutical exports stood at US$17.3 billion in 2017-18 and are expected to cross US$19 billion in 2018-19.