Company Watch

Lupin acquires Germany based Hormosan Pharma

Sachin Jagdale - Mumbai

It seems acquisitions have become a flavour of the season for Indian pharma companies. Mumbai based pharmaceutical giant, Lupin, extended the list of acquirers by recently taking over Hormosan Pharma Gmbh (Hormosan), a German sales and marketing generics company specialised in the supply of pharma products for the Central Nervous System (CNS).

"This is in line with our M&A strategy to harness the potential of the leading global pharma markets. This move establishes a bridgehead in Germany and is our first acquisition in the important European market. Hormosan has strengths in the sales and marketing of its products nationwide, together with strong regulatory and pharmacovigilance capabilities that can strengthen our European know-how. Lupin will be able to add significant value through its strengths in R&D and strong, complementary pipeline leading to major synergies and growth," opined Dr Desh Bandhu Gupta, Chairman, Lupin.

Hormosan has recorded a sale of €6.8 million for the year ended December 2007. It develops licenses and markets a range of generics in Germany. Hormosan has a hand in supplying pharma products for the central nervous system.

Lupin is hoping for great improvement in its revenue figures in the European market with this acquisition. In response to a query, Gupta replied, "Our European foray commenced generating revenues last year with the launch of Cefpodoxime Proxetil in France and Lisinopril in UK. We generated about $12 million from Europe. With this acquisition, we believe in the forthcoming years, we should be able to achieve galloping growth. The participatory market size of Lupin Pipeline in Germany is around $ 4.5 billion."

The foray of Indian pharma companies into important international pharma markets shows their expanding appetite for growth. According to Gupta the global pharma market has been witnessing consolidation and in India particularly over the past few years, Indian companies have stepped up their acquisition activity in different parts of the world.

"In terms of business, national boundaries have become permeable and going forward you will see Indian firms getting more aggressive in this arena," asserts Gupta. There are the isolated cases of difficulties during mergers post acquisition. However, Lupin is not going to face this problem as they have a carefully implemented strategy of acquiring a slim and lean organisation with strong market penetration and good equity with pharmacists and trade. "Hormosan has well established relationships with the trade which will stand us in good stead," feels Gupta. He concludes, "We are constantly pursuing our strategy of strengthening our global presence through strategic acquisitions in potential markets." Recently, the company has received final approval for its Abbreviated New Drug Application (ANDA) for divalproex sodium delayed-release tablets, 125 mg, 250 mg and 500 mg from US Food and Drug Administration (FDA). The company has already commenced commercial shipments for this product. It is an AB-rated generic equivalent of Abbott Laboratories' Depakote tablets. As per IMS Health sales data during March 2008 it had annual sales of approximately $803 million.

sachin.jagdale@expressindia.com