Consolidation continues apace in the generics sector, with Mylan agreeing a $1.6bn deal to acquire Strides Arcolab of India’s sterile injectables business unit.
The deal for Bangalore-based Agila Specialties boosts Mylan’s position in a therapeutic category which has been plagued by shortages in the US and elsewhere, as a result of manufacturing problems and some companies withdrawing from the market.
Mylan’s chief executive Heather Bresch said absorbing Agila Specialities will make the company a “top three player” in injectables and double the company’s turnover in the category to around $1bn in the first year after the acquisition concludes. The deal is expected to close in the fourth quarter of 2013.
“Agila brings us one of the most diversified, highest-quality and state-of-the-art injectables manufacturing bases in the industry”, boosting capacity 50-fold, said Bresch on a conference call yesterday to discuss the deal and Mylan’s fourth-quarter results.
The deal follows other large-scale M&A deals in the generics sector in recent months, notably the $5.9bn Watson-Actavis merger, Sandoz ‘ $1.53bn acquisition of Fougera Pharma and Sun Pharma’s $600m transaction to take a majority-stage in Taro Pharma.
For Mylan, the deal follows the acquisitions of Merck KGaA’s generics business for $6.7bn in 2008, a $550m deal for Ireland’s Bioniche in 2010 and the $33m takeover of an SMS Pharma manufacturing facility in India, as well as an insulin analogue/biosimilar collaboration signed with Biocon earlier this month.
The proposed takeover also boosts its geographic presence, particularly in emerging pharma markets such as Brazil which accounts for a quarter of Agila Specialties’ turnover, provides another platform for Mylan’s biosimilar aspirations.
The agreement comes as Mylan reported record financial results in 2012, with revenues up 14 per cent to $6.8bn on the back of 600 product launches around the world, and earnings per share 27 per cent higher at $2.59.