Baxter seeks shot in the arm, eyes acquisitions

NEW DELHI: Critical therapy giant, Baxter is scouting for companies in India for a possible acquisition soon. Interestingly, the move is not meant to expand its portfolio, but to get a readymade distribution and sales force to help the medication delivery major penetrate faster in the health care market. “We are looking at 3-4 companies in the pharma and injectible space used in critical care,” Baxter India country head Sanjiv Verma told ET. He, however, declined to go into specifics.

When it happens, this would be the second acquisition by the $9.8bn IV solutions company. Five years back, Baxter India had bought Wockhardt’s IV solutions business. The acquisition had brought the company a much-needed sales & marketing infrastructure covering a wide spectrum of public and private hospitals across India. Besides, it also helped Baxter to gain a stronger foothold in the Rs 500 crore IV fluids market.

While Mr Verma says that Baxter has a team continuously on the look out for relevant companies for acquisition, valuations in the Indian pharma and healthcare sector have been a deterrent. “Perceptibly Indian pharma companies have overvalued themselves and hopefully things will change soon,” he said. Yet rapid topline remained elusive for the company in the price control environment in India.

The company continues to play in niche areas in healthcare such as critical care, peritoneal dialysis and medication delivery segments. The company has now embarked on an aggressive strategy to accelerate growth. It is setting up haemo dialysis care centres in rented space in hospitals.

“These would serve as counselling centres for acute kidney patients in need for dialysis and help us propogate the therapy we sell,” Mr Verma said. Some 19 such centres are already operational in leading hospitals in Delhi, Mumbai, Chennai, Madurai and Trichy to name a few. Baxter plans to add 20 centres annually.

The company is extremely bullish on the home dialysis segment which is highly profitable, albeit very small currently. Baxter is serving some 4,000 odd households at the moment which spend Rs 15,000-20,000 per month and hope to increase it to 10,000 households in the next few years. Meanwhile, it is focusing on workshops and seminars for general practioners. Baxter’s cumulative investments exceeds Rs 250 crore in the past 10 years.