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Aurobindo to acquire dermatology and oral solids businesses from Sandoz Inc., USA

Posted On: 2018-09-06 12:05:18

Aurobindo Pharma Limited (BSE: 524804 and NSE: AUROPHARMA) ("Aurobindo"), a world-leading marketer and manufacturer of generic pharmaceuticals and active pharmaceutical ingredients, announces the signing of a definitive agreement to acquire certain assets from Sandoz Inc., USA ("Sandoz"), a Novartis Division, comprising a market leading dermatology business and a portfolio of oral solid products along with commercial and manufacturing infrastructure in the US. The acquisition will be on debt free and cash free basis and will be made through its wholly owned subsidiary, Aurobindo Pharma USA Inc. Aurobindo and Sandoz will enter into a transitional services agreement to support the ongoing growth plans of the businesses being acquired by Aurobindo.

The transaction will be an all cash transaction which Aurobindo will finance through a fully committed debt facility.

This US acquisition is in line with Aurobindo's strategy to strengthen and grow its global business and to expand and enhance its product portfolio offerings in key therapeutic areas.

The acquisition will give Aurobindo a market leading dermatology franchise comprising a wide portfolio of generic and a range of branded products which are well recognized by patients, pharmacists and retail/wholesale customers. Aurobindo will also acquire a well-established commercial infrastructure with a fully-dedicated dermatology sales force along with a state-of-the-art manufacturing facility with specialized capabilities in creams, ointments, lotions, topical solutions and topical suspensions that are highly complementary to Aurobindo' s current manufacturing footprint.

The acquired generic dermatology portfolio covers a wide range of therapeutic areas including topical antibiotics, gynaecological and dermatological antifungal agents, anti-acne agents, local anaesthetic analgesics, anti-itch, and a dermatological chemotherapeutic agent. The oral nondermatological portfolio that is being acquired spans a wide range of therapeutic areas including auto-immune disease, anti-neoplastic agents and a variety of hormonal agents amongst others.

The acquisition enhances Aurobindo's market leading pipeline of Abbreviated New Drug Application (ANDA) filings with additional pipeline projects, including AND As that have already been filed, products under development, and first-to-file opportunities which have the potential to be exclusive.

Commenting on the transaction, Mr. N. Govindarajan, Managing Director of Aurobindo, said: "The acquisition announced today is in line with our strategy to grow and diversify our business in the US. Acquiring these businesses from Sandoz will allow us to further expand our product offering and to become a leading player in the generic dermatology market. Overall the transaction will position Aurobindo as the 2nd largest dermatology player and the 2nd largest generics company in the US by prescriptions. We expect a seamless integration of the acquired businesses with the rest of the Aurobindo group given the success we have achieved in our acquisitions to date. As we have done in some of our previous acquisitions, we will be focused on leveraging our Group's market leading vertically integrated and highly efficient manufacturing base to enhance the market position and medium-term profitability of the businesses we are acquiring."

Mr. Govindarajan added, "We look forward to delivering the benefits of this transaction to all our stakeholders including employees, patients, customers and healthcare providers across the US."

The transaction is expected to close in the course of 2019 following the completion of customary closing conditions, including FTC clearance.

This announcement does not constitute a recommendation to shareholders or potential investors.

Jefferies International Limited acted as financial advisor and Morgan, Lewis & Bockius LLP acted as legal counsel to Aurobindo.

Shares of AUROBINDO PHARMA LTD. was last trading in BSE at Rs.696.1 as compared to the previous close of Rs. 676.45. The total number of shares traded during the day was 163090 in over 2766 trades.

The stock hit an intraday high of Rs. 698.15 and intraday low of 677.2. The net turnover during the day was Rs. 112391654.


Source: Equity Bulls

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