Glenmark sells gynac business for Rs 115 crore

Glenmark Pharma has sold its gynaecology business to private equity firm True North backed Integrace Pharma in an attempt to cut down debt of the company.

The sale of the gynac business comes two years after it sold its orthopedic business to the same company. Integrace will pay Rs 115 crore for four products of the portfolio that includes products like Dubagest, Mumfer and Fenza. These three products currently have sales of Rs 60 crore and are growing by 15%.

This portfolio reflects roughly 60 cr in IQVIA and growing by 15%. There are 3 main brands – Dubagest , Mumfer and Fenza. Indian drug makers like Glenmark have made investments in R&D and US markets, yet the debt has been ballooning on their books. This has become an rationale for these companies to look at trimming their non core segments.

It is the US business that is a worry for most companies. Rating agency CRISIL has said the woes of Indian generic companies are likely to continue as the regulatory action by the US Food and Drug Administration (USFDA) will delay their product launches in the US markets. CRISIL predicts that 18% of new product launches by Indian companies will be delayed in the US.

The warning letter issued by the USFDA to large pharma companies more than doubled in the first 10 months of 2019 compared with the previous year, CRISIL said, adding that close to 180 generic drug launches will be pushed out from their intended launch dates due to it.

Glenmark’s India business however has been growing thanks to it’s new launches in diabetes segment. It recorded sales worth Rs 3239 crore in 2019 with a 9% growth. On Tuesday shares of Glenmark closed at Rs 350 marginally up.