Strides Arcolab to leverage API business in Shasun acquisition
In July during while discussing finance ial results, CEO Arun Kumar told investors Strides Arcolab had no plans for any “large ticket acquisitions.” Two months on and the Indian drugmaker announced this week it was looking to acquire Shasun Pharmaceuticals for an estimated $200m, creating a top 15 Indian pharma firm with joint revenues of over $400m.
“Since the divestment of our injectables business [Agila to Mylan for $1.6bn last year], Strides has refocused on its oral finished formulation business,” Kumar said announcing the deal which, he added, “accelerates our strategy and growth prospects by creating a larger scale, fully integrated, leading Indian pharma company with multiple growth drivers and synergies.”
The API business represents about 60% of Shasun’s income and the deal adds a portfolio of 43 commercialised drug master files (DMF) and a further 23 under development to Strides.
Shasun has a network of 12 manufacturing facilities with three US Food and Drug Administration (FDA) approved finished dose plants and two FDA approved active pharmaceutical ingredient (API) sites, all of which will be integrated into Strides’ existing business.
Furthermore, Abhaya Kumar, the Managing Director of Shasun, told in-Pharmatechnologist.com: “We have lots of spare capacity [in our API network]” which will be leveraged by Strides, and there will be no redundancies due to this deal.
Along with approximately 2,100 workers, the deal also brings with it a CRAMS (Contract Research and Manufacturing Services) business and Kumar confirmed all existing supply agreements would continue. “No existing contracts will be hampered,” he told us.