Everstone Capital will invest up to $50 million (about Rs 360 crore) in US-headquartered Slayback Pharma LLC, in its latest bet of the private equity firm backing a drugmaker.
Slayback said in a statement that it will use the funds to expand its generic and speciality pharmaceutical product pipeline. As part of the agreement, Everstone managing directors Arjun Oberoi and Puncham Mukim will join Slayback’s board of directors.
News of the funding comes after VCCircle in December reported that Everstone was in advanced talks to invest up to $60 million (around Rs 431 crore).
“Their (Everstone) experience in investing in and building pharmaceutical businesses with a focus on regulated markets will help turbo-charge our growth pipeline,” Slayback founder and chief executive officer Ajay Singh said.
Separately, Everstone co-founder and CEO Sameer Sain said the firm was confident in its investment in Slayback because of its expertise in the generics space and the commercial potential of its product portfolio.
Mumbai-based financial services firm Avendus Capital acted as the exclusive financial advisor to Slayback on the transaction.
Slayback Pharma was founded by Ajay Singh in 2011. Singh previously worked as a vice president of strategy, portfolio, and business development at Dr Reddy’s for its North American generics division. In 2017, the pharma firm raised $60 million from a US fund of private equity giant KKR to expand its portfolio of generic and specialty pharmaceutical products. At the time, KKR executives Ali Satvat and Neel Varshney had joined Slayback's board.
Everstone's investment in Slayback marks the PE firm's latest investment in the larger healthcare sector. Last year, the PE firm backed in-vitro diagnostics instrument maker CPC Diagnostics, acquired a controlling stake in Pune-based hospital chain Sahyadri Hospitals Ltd and bought a significant minority stake in medical devices firm Translumina Therapeutics.
There has been a growing number of pharmaceutical deals by PE firms as growth slowly returns to the sector. Earlier this month, homegrown firm True North acquired around 3% of Biocon Biologics India Ltd, a wholly-owned subsidiary of Biocon for $100 million (around Rs 719.36 crore), valuing it at between $3 billion to $3.5 billion.
VCCircle also reported recently that the promoters of Hyderabad-based drugmaker Granules India Ltd had initiated talks that may pave the way for a new controlling shareholder. Drugmaker Wockhardt is also said to be have been in talks with both strategic players such as Cipla Ltd and investors such as PAG to sell its formulations business.