Indian specialty pharmaceuticals company Eurolife Healthcare said it will acquire the form-fill-seal (FSS) infusion business from Baxter India, a subsidiary of US-based medical products company Baxter International, for an undisclosed amount.
Baxter International was is in talks to sell a part of its India portfolio and had hired audit firm and management consultancy KPMG for the process, VCCircle first reported in September.
Eurolife Healthcare, founded in 2001 and backed by global healthcare focused fund OrbiMed, will own Baxter’s IV solutions plants in Maharashtra and Tamil Nadu following the close of the transaction, the company said in a statement.
The expanded geographic footprint will therefore allow Eurolife to service its local distribution network more efficiently and reduce time-to-market to distributors, hospitals and patients, it said.
The acquisition will also help in meeting the demand for Eurolife’s products from its export distribution network spread over 22 countries.
“Eurolife is committed to making significant investments in the acquired facilities, in order to expand capacity to feed our flourishing FFS Infusions business both locally and globally,” said Sandeep Toshniwal, CEO, Eurolife Healthcare.
Eurolife Healthcare was founded by Shyam Toshniwal, who is Sandeep Toshniwal’s father. It is a pharmaceutical formulations manufacturer with two plants in Uttarakhand.
The first plant manufacturers sterile infusions and injectables, opthalmics and water for injections, and supplies certain formulations to Baxter US, Cipla and Sun Pharma, among others. It has sales all across the country in addition to 31 countries internationally.
The company’s second plant manufactures tablets and capsules and markets its products in over 15 countries. The company clocked revenues of Rs 105 crore in FY2015-2016.
Baxter India had acquired the IV business from Wockhardt in 2002 for $32 million (Rs 195 crore then), as per VCCEdge, the data research platform of News Corp VCCircle.
The transaction is subject to customary closing conditions and is expected to close by the end of the year.
Baxter India sells products in anaesthesia, bio surgery, clinical nutrition, infusion systems and renal segments, as per its website.
Globally, Baxter International moved towards paring down its stake in Baxalta to 5.1% from 13%, a report by The Wall Street Journal stated. Baxalta was founded in July 2015 after Baxter International spun off its biopharmaceutical division.
The company was, however, among the bidders to buy Indian pharmaceuticals firm Gland Pharma but lost out to China’s Fosun International.
Baxter India reported a turnover of around Rs 747.5 crore for the year ended 31 March 2015. Its profit after tax for FY2014-15 was around Rs 6 crore compared with Rs 22 crore in FY2013-14, as per VCCEdge. The company’s FY2015-16 financials could not be ascertained.
Global drug firms have been rationalising their Indian assets over the last year. Last year, UCB sold its non-core portfolio to Dr Reddys’ Laboratories for $128 million.
Merck sold five OTC brands to Piramal Healthcare earlier this year for $14 million.
Indian entities have also been rationalising their assets, getting rid of what they consider non-core in their portfolios. Sun Pharma sold its CNS portfolio to Strides Arcolab last year. It also sold a clutch of brands to RPG Life Sciences earlier this year.
Like this report? Sign up for our daily newsletter to get our top reports.