India’s third largest drug maker CiplaBSE 0.54 % has closed the acquisitions of InvaGen and Exelan, the two drug companies it purchased last September in an all cash transaction worth $550 million. The development marks an important step for the company in bolstering its fledgling presence in the US, with an additional revenue of $230 million in FY 2017, company official said. The deal closure, that involved approvals from the US regulatory agencies, will see Cipla vault its sales from that market to around $400 million. It expects to launch as many as 10 products in FY2017. Cipla expects to file 3 to 4 products cumulatively each quarter via its newest acquisition. Speaking to ET, Cipla COO Umang Vohra said going forward the company may exit a few geographies while more attention will be given to certain critical markets like the US. “The idea is to simplify our business and stay focused,” he noted. As for the European market, Vohra stressed the company will look at alliances as against establishing direct front-ends. Vohra clarified that the case pursued by PuraCap against Invagen with respect to the deal has also been resolved. “The acquisition of InvaGen pharmaceuticals also provides Cipla with about 40 approved ANDAs, 32 marketed products, and 30 pipeline products which are expected to be approved over the next 4 years. They represent a balanced, diversified and growing portfolio targeting highly attractive, large and niche markets,” Cipla had said at the time it announced the deal in September last year. Cipla expects to add to its product range in CNS, CVS, anti-infectives, diabetes as well as other value added generics through InvaGen. Additionally, InvaGen brings to Cipla 5 first-to-file products which represents a market size of roughly $8 billion in revenue by 2018. The Invagen deal enable Cipla get access to manufacturing sites in the US and also reach to a large network of wholesalers and retailers in the US. Through Exelan, Cipla will be able to access government and institutional market. The Indian drug maker known which had a late start in tapping the US market, expects to garner around 25% of its total revenues from the US over the next 4 to 5 years. Other large drug makers like Dr. Reddy’s and Sun have grown rapidly in that market with about half of their global revenues already coming from the US, as they seek to branch out into more specialized products to grow further.
Source: Economic TimesCipla seals Invagen and Exelan deals in US.
Industry: Pharmaceutical 2016-02-18
