Unichem plans Rs 110-cr pharma buyout in Brazil
By Gireesh Chandra Prasad, TNN |
Highlights
MUMBAI: Mid-sized drug maker Unichem Laboratories is set to acquire a pharma company in Brazil, the fastest growing pharmaceutical market in the world.
The company is now at an advanced stage of negotiations with a firm having own marketing network, a few product approvals, a warehouse and a quality control division, Unichem���s chairman and managing director Prakash Modi told ET on Thursday.
Unichem does not require a manufacturing plant and the deal is in the range of Rs 110 crore ($25 million), he said. Manufacturing cost in Brazil is about twice as much as it is in India, according to industry sources. Brazil���s pharmaceuticals market is estimated to be about Rs 38,600 crore, larger than the India���s. The company will not dilute equity and the expansion requirement would be met through internal accrual and debt, said Mr Modi.
Unichem���s proposed acquisition reflects the increasing interest of Indian drug makers in a market that grows at 32% a year, the fastest in the world. According to IMS data, top three pharma markets in Latin America including Brazil has a market of about $18.8 billion. A lesser known city-based drug maker Maneesh Pharmaceuticals had acquired Brazil���s Laboratorio Sanobiol, for $8 million just a week ago.
The proposed acquisition will be made by Unichem and not by its Brazilian subsidiary ��� Unichem Farmaceutica do Brasil, which has about seven product approvals already. However, acquisitions in eastern Europe would be through Unichem���s UK arm Niche Generics.
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Unichem had had recently acquired the remaining 40% in Niche Generics to make this joint venture a wholly owned subsidiary. The company is engaged in product development, dossier filing and manufacturing formulations for the European markets. Unichem is also planning a domestic acquisition, which is at a preliminary stage now. ���We would look at a formulations company that has less than 20% brands clashing with our portfolio,��� said Mr Modi.Unichem is also planning to expand its US presence with at least one generic drug application a month. It already has got the ANDA approval for arthritis drug meloxicam and has four manufacturing plants in India in Maharashtra, Goa, Uttar Pradesh, and Himachal Pradesh, said Unichem���s wholetime director BK Sharma.
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