HYDERABAD: Indian pharma giant Aurobindo Pharma has acquired US-based Sandoz’s dermatology and oral solids businesses for $900 million, scripting one of the largest pharma deals.
According to the transaction summary, Aurobindo Pharma USA Inc, a wholly owned subsidiary of Aurobindo Pharma Limited, entered into a definitive agreement with Sandoz Inc, USA, to acquire its dermatology and oral solid businesses on Wednesday.
The deal includes upfront purchase price of $0.9 billion in cash, along with potential upside in near-term earn-out on pipeline products in outer years. The transaction is on a debt-free and cash-free basis and will be financed via a fully committed debt facility.
The portfolio being divested generated sales of $0.6 billion in H1 2018 for Sandoz. After expiration of certain in-licensed product contracts and rationalisations of acquired products that will not negatively impact profitability, the portfolio is expected to generate over $0.9 billion in sales for the first 12 months after completion of the transaction.
Acquired portfolio consists of authorised generics and in-licensed products opening up future opportunities for Aurobindo, with 70 per cent revenue contribution by oral solids and 30 per cent by dermatology.
With this acquisition, Aurobindo, which stands in fourth place right now, would become the second largest generics player in the US by the number of prescriptions. It will diversify its portfolio further with 300 products including projects in development.
Aurobindo’s exploits
■ With the acquisition, Aurobindo Pharma stands to become the second largest generics player in the US, going by the number of prescriptions.
■ The company’s portfolio will be diversified further with 300 products, including the projects in development.