Outbound pharma cos shy away from generic biz

Out of the 13 outbound deals in the last four months, only three deals are in the conventional areas like drug formulations and pharmaceuticals ingredients.

In April, the sector witnessed smaller buyouts such as SIRO Clinpharm's purchase of Omega Mediation and Jupiter Bio's takeover of Merck Life Sciences' manufacturing facility (contract research). Major buyouts like Jubilant Organosys' acquisition of Draxis Health for $255 million helped Jubilant strengthen its contract manufacturing business.

Alok Gupta, executive vice-president and country head of Life Sciences &Technology, Yes Bank, said, "Nowadays, the formulation business is not a priority in M&A deals. Indian firms have enough capacity in generic formulation manufacturing and the plants have approvals from the major regulatory authorities across the globe, which pushes them back from buying generic firms with manufacturing facilities abroad."

This year, Dr Reddy's Laboratories has made two acquisitions in sectors like contract research and manufacturing, from BASF and DowPharma, but only one in formulations, from Italian firm Jet Generici. Aurobindo's TAD Pharma acquisition and Marksans Pharma's buyout of UK-based generic firm Hale Group Ltd are other deals in formulations segment.

Gupta added, "Buying the foreign firms having

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