Pfizer eyes Dr Reddy’s Rs 1000 cr branded generics business: Reports

World’s top drug maker Pfizer is reportedly in talks to buy a stake in India’s leading generic firm Dr Reddy’s Laboratories.

Pfizer is keen to acquire the Hyderabad, south India-based Dr Reddy’s generic formulations business, reports quoting unconfirmed sources said.

However, Dr Reddy’s officials denied such reports as rumours and speculations.

Dr. Reddy’s was not and is not considering sale of any of its businesses in any manner whatsoever nor is it offering for sale any equity or any assets, G V Prasad, VC & CEO of Dr. Reddy’s Labs was quoted as saying.

Pfizer already has generic formulations supply arrangements with three of the Indian companies.

In May last year, Pfizer acquired rights to 55 generic  pills and 20 injectables for more than 70 emerging and developed markets through new deals.Pfizer Inc, has entered into a licensing pact with Indian generic injectables producer Claris Lifesciences besides expanding it present alliance with Aurobindo.

Pfizer’s pacts with the Indian generic companies are seen as part of its strategy to invest more heavily in generics and developing countries amid pressures slowing growth in leading markets and US healthcare reform.

Pfizer has expanded the existing collaboration with the Hyderabad, South India-based Aurobindo Pharma Ltd reached earlier this year to sell 60 off-patent drugs. Meanwhile Pfizer’s agreement with Claris Lifesciences Ltd is to market 15 off-patent injectable drugs.

In January, Pfizer  entered into a collaboration with India’s Strides Arcolab on the supply of 40 generic products.

Pfizer’s new deal with Strides Arcolab follows two similar alliances last year with Aurobindo and Claris LifeSciences of India.

Under the new collaboration Pfizer will commercialize Stride’s off-patent sterile injectable and oral products in the United States through its Established Products Business Unit.

These finished dosage form products will be licensed and supplied by Strides and Onco Laboratories Limited and Onco Therapies Limited, two joint ventures between Strides and Aspen, South Africa, in which each has a 50% ownership interest.

Dr Reddy’s sales from formulations in India are expected to be Rs 1000 crore this fiscal.

Dr Reddy’s branded generics portfolio offers over 200 products in the major therapeutic areas of gastro-intestinal, cardiovascular, pain management, oncology, anti-infectives, paediatrics and dermatology.

Brands like Omez, Ciprolet, Nise, Enam, Ketorol, Exifine and Cetrine enjoy leadership positions in several key markets, including India, Romania, Venezuela, Russia & the CIS countries. The company has brands like Omez, Nise, Enam in key segments like gastro-intestinal, cardiovascular and pain management.

Dr Redddy’s markets over 40 product families marketed in the US. The company has 133 abbreviated new drug applications (ANDAs) filed till date in US. 69 ANDAs pending approval at the USFDA, of which 32 are Para IV and 19 are first to files (FTFs).

The company markets about 160 products marketed in the EU markets.

Dr Reddy’s has 8 US FDA inspected facilities (6 in India, 1 in Mexico and 1 in UK).

Dr Reddy’s Laboratories reported a consolidated net loss of Rs 233 crore for the quarter ended December 31, 2009, compared to a net profit of Rs 159 crore in the same period last year, mainly on account of write down of goodwill amount of Rs 514.7 crore on consolidated basis.

In June, Dr Reddy’s agreed to supply GlaxoSmithKline (GSK) with over 100 branded drugs to be sold in Africa, west Asia, Asia Pacific and Latin America.

As per agreed terms, the products will be manufactured by Dr. Reddy’s and will be licensed and supplied to GSK in various emerging markets  excluding India. Revenues will be reported by GSK and will be shared with Dr. Reddy’s . In certain markets products will be co-marketed by Dr. Reddy’s and GSK.

Recently, there were unconfirmed reports suggesting that Dr Reddy may sell five percent of the company’s founders’ stake holding to GlaxoSmithKline for a consideration of nearly $150 million.

The world’s second largest drug maker GlaxoSmithKline was reportedly in talks with its Indian associate in generic drugs business Dr Reddy’s to buy a 5 percent stake.