Eris To Buy Biocon Biologics’ India Branded Formulation Business For $150 Mln

Drugmaker Eris Lifesciences Ltd. agreed to acquire Biocon Biologics Ltd.’s India branded formulation business for 1,242 crore rupees ($150 million).

The acquisition will bring into the company’s fold two major insulin brands, Basalog and Insugen, which are the largest Indian brands in their respective segments with market shares of over 10%, Eris said in a stock exchange announcement.

The Indian pharma company said the scope of acquisition includes Biocon’s insulin, critical care and oncology portfolios. With this acquisition, the company’s diabetes care franchise will soon reach 1,000 crore rupees in revenue and become the fifth largest diabetes portfolio in India, it added.

The company said the acquisition will mark its entry into oncology and critical care, as well as see the transition of more than 435 employees (including over 325 medical representatives) from Biocon to Eris.

Eris, which will fund the deal through debt financing, expects to achieve financial closure by 15 April.

SUPPLY PACT & SYNERGIES

The company said it also signed a 10-year supply agreement with Biocon Biologics as part of the deal. Under this agreement, the Biocon product range will continue to be manufactured and supplied to Eris for commercialization in India.

Eris, which previously announced acquisition of a 51% stake in Swiss Parenterals Ltd., said the latest deal also provides immediate synergies with Swiss Parenterals’ business.

The Biocon product range can be quickly scaled up by leveraging the product portfolio of Swiss Parenterals, which consists of over 240 unique molecules, it added.

Eris said the combination of the two deals also provides margin expansion opportunities through insourcing/technology transfer of manufacturing to Swiss Parenterals’ facilities.

TURBOCHARGING GROWTH

Eris Chairman & Managing Director Amit Bakshi said the company added a number of strategic growth engines to its portfolio over the last two years. The company now has all the building blocks in place to be able to achieve its revenue target of 5,000 crore rupees over the next three-to-four years, it added.

“This deal, combined with the acquisition of Swiss Parenterals that we announced last month, will turbocharge our entry into the 30,000 plus crore rupees India branded injectables market and pave the way for our next 1,000 crore rupees vertical in the next three-four years,” Bakshi said.

Separately, Eris said its board approved acquiring a 19% stake in the company from its promoters for 237.50 crore rupees in cash. The deal is expected to close by 30 September.

Note: $1 = 82.8466 Indian rupees

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