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Strides Shasun to acquire Perrigo API India for $14.8 mn

12 December, 2016

Drugmaker Strides Shasun Ltd said on Friday it has agreed to acquire Perrigo API India Pvt Ltd for Rs 100 crore ($14.8 million) in cash.

The deal is part of a strategy to build a backward integrated portfolio of niche and small volume products for the regulated markets, Strides group CEO Shashank Sinha said in a stock-exchange filing.

The transaction, subject to customary closing conditions, is expected to be completed by December 31, 2016, the company said. 

The firm has been trying to strengthen its active pharmaceutical ingredients (API) facilities since 2014, when Arun Kumar-led Strides Arcolab Ltd merged with Shasun Pharmaceuticals Ltd in a $221 million transaction to create the entity Strides Shasun Ltd. The deal helped the firm acquire two US FDA approved facilities with APIs for captive consumption and commodity APIs, among other things.

Earlier this year, it also spun off its commodity API business from this merged entity into a wholly owned subsidiary. The move enabled the company to focus the remaining API business on captive consumption, including building a portfolio of backward integrated small molecules, and catering to the high entry barrier markets of Japan and South Korea.  

Now, the Perrigo API plant, certified by the United States’ Food and Drug Administration (FDA), is also expected to augment API manufacturing resources for captive consumption. Perrigo will also source products from this API facility as part of a long term supply arrangement, the company said. 

Strides is expecting to transfer all of its existing Drug Master Files to the newly acquired manufacturing plant, which has a capacity of 600 tonnes per year. The Perrigo API plant was inspected by the US FDA last year and passed with zero 483s, the company said. A 483 is issued to a drug maker by the FDA and typically contains a list of observations which could potentially be a violation of FDA norms. 

Perrigo API India makes active pharmaceutical ingredients, or bulk drugs, at its plant in Maharashtra. It posted revenue of Rs 73.67 crore for 2015-16.

Strides’s other recent acquisitions

In recent times, Strides Shasun Ltd has also been enhancing its consumer healthcare portfolio. In November, it acquiredPediaCare, a branded drug which treats cold, cough and allergy, from Moberg Pharma for $5 million. In March, Strides acquired three brands – JointFlex, Fergon and Vanquish – also from Moberg Pharma for $10 million plus inventory value to build its portfolio of over-the-counter (OTC) products.

In October 2015, it acquired seven brands from Johnson & Johnson (J&J) for Rs 32 crore.

Since 2014, when Strides moved to merge with Shasun, the entity has acquired South Africa’s Aspen Pharmaceuticals generics business in Australia for $300 million. 

In February 2016, it separately acquired stakes in an Australian and a Kenyan firm to enhance presence in both countries. 

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Strides Shasun to acquire Perrigo API India for $14.8 mn

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