GSK not under compulsion to buy Indian companies: Hasit Joshipura

NEW DELHI: UK's biggest drug maker GSK will not pay exorbitant price to buy Indian companies as it is under no such compulsions, a top company executive said.

Hasit Joshipura, GSK India MD said while the company is open to acquisitions, the target has to first fit its strategy and should come at the right valuation. "We are not under compulsion to play catch up (in the local market)."

At present, GSK India is ranked fourth in the Rs 60,000 crore Indian drug market, behind US-based Abott Laboratories, Cipla and Daiichi Sankyo-owned Ranbaxy. But both Abbott and Daiichi Sankyo jumped to the top positions through acquisition of domestic formulation business of Piramal Healthcare in 2010 and Ranbaxy in 2008 respectively.

GSK, on the other hand, has maintained its position by growing its business organically. The company's share price was trading at Rs 2090, down 1.67% at the BSE.

Global pharma companies have been aggressively looking to buy Indian firms to mitigate revenue loss due to patent expiry of their top selling brands and also tap the fast growing Indian drug market.

Other acquisitions by global MNCs include Sanofi Aventis' purchase of Shantha Biotech and Universal Medicare and Fresenuis Kabi buyout of Dabur Pharma. Some of these acquisitions have come at a jaw-dropping valuation.

Abbot paid Rs 17,000 crore to buy Piramal Healthcare business which had revenues of Rs 2000 crore. GSK has also been speculated to be in discussions to buy Indian companies.