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BMS Manufactures for Now as Reckitt Benckiser Enters Latin America

By Dan Stanton , 13-Feb-2013
Last updated on 13-Feb-2013 at 13:11 GMT

Bristol-Myers Squibb (B-MS) will continue to make the OTCs it licensed to Reckitt Benckiser for the time being but will hand over manufacturing if the UK drugmaker buys them outright.

Earlier this week Reckitt licensed the right to sell six over the counter (OTC) products in Latin America, paying Bristol Myers Squibb $44m (€32.6m) to secure the option of buying the drugs after three years.

For now the licensing deal will see Bristol-Myers manufacture and supply the drugs for Slough, UK based Reckitt but Bristol-Myers spokeswoman Jennifer Mauer told us that if the purchase option is taken up “Reckitt Benckiser would then assume all responsibility for the products, including manufacturing.”

Reckitt confirmed this, telling this publication that it had a manufacturing “strategy in place” but declined to elaborate any further.

Bristol-Myers will receive an upfront payment of $438m for the exclusive rights to the following OTCs (over-the-counter drugs) which are primarily marketed in Brazil and Mexico: Naldecon (coughs and colds), Luftal (flatulence) and Dermodex (nappy-rash), Tempra (pain relief), Picot (acid reflux) and Graneodin-B (sore throat) in Mexico.

Latin America

In a press statement Rakesh Kapoor, the CEO of Reckitt, said that the deal “is an important step in building our consumer health care presence in Latin American emerging markets.”

He pointed out the “strong margins” and “extremely good growth potential” of the OTCs as Reckitt attempts to solidify its presence as a global consumer-health company, in light of declining sales in its home European market .

Other News

The sale of Aché Laboratorios Farmaceuticos, one of Brazil’s largest pharmaceutical companies, is forthcoming with AstraZeneca being the latest in a string of big Pharma companies interested in a possible takeover, according to The Daily Telegraph ,

Novartis, Pfizer and Abbott Laboratories have all been reported as potential buyers for the company which could go for up to $4bn, following news last week from Reuters  that the investment bank Lazard had been mandated by key shareholders to investigate a possible sale of Aché.