Eris Lifesciences, a Mumbai-based listed pharmaceutical company backed by private equity firm ChrysCapital and Kuwait Investment Authority, is to acquire biopharmaceutical company Biocon Biologics’ India branded formulation business in a deal valued at $150 million (Rs 1,242 crore).
The acquisition, including insulin brands Basalog and Insugen, is slated to be completed by 15 April, 2024, the company said in an exchange filing.
This strategic move is expected to propel Eris’s diabetes care franchise to reach Rs 1,000 crore in revenue within the next 3-4 years, positioning it as the 5th largest diabetes portfolio in India. Furthermore, the acquisition marks Eris's entry into the oncology and critical care segments.
“Over the last two years, we have added a number of strategic growth engines to our portfolio and now we have all the building blocks in place to be able to achieve our target of Rs 5,000 crore revenue over the next 3-4 years,” said Amit Bakshi, chairman & managing director of Eris Lifesciences.
Additionally, the acquisition includes a 10-year supply agreement with Biocon Biologics, ensuring the continued manufacturing and supply of Biocon's product range for commercialisation in India. This acquisition complements Eris's recent purchase of Swiss Parenterals, offering immediate synergies and margin expansion opportunities through manufacturing insourcing and technology transfer to Swiss’ facilities.
The transaction follows Biocon’s earlier sale of its dermatology and nephrology branded formulation businesses to Eris for Rs 366 crore in November of the previous year. Eris has demonstrated a consistent track record of strategic growth, entering the neuropsychiatry vertical in 2017 with the acquisition of Strides Pharma's domestic business and subsequently venturing into dermatology with the purchase of Oaknet Healthcare, in addition to acquiring brand portfolios from Glenmark and Dr Reddy's in early 2023.
Its consolidated revenue in the financial year ended March 2023 increased to Rs 1,685 crore from Rs 1,347 crore in the fiscal before. On the other hand, its net profit decreased 8% to Rs 374 crore in FY23 from Rs 408 crore in the previous year.
Established in 2007, Eris Lifesciences operates with a pure-play domestic branded formulations business model, boasting an India distribution network of over 2,000 stockists and more than 5 lakh chemists. The company, headquartered in Ahmedabad and Mumbai, employs approximately 5,000 individuals.
Shares of Biocon surged by 5.5% on the Bomaby Stock Exchange at Rs 267 apiece, while Eris's stock closed 4% higher at Rs 863.50 per share.
