The new subsidiary will give focus to our activities in molecular imaging, which we think has a promising future, said Piramal. We will fund the buy through internal accruals.
In May last year, PHL had sold its core domestic formulations business to US-based Abbott Laboratories for $3.8 billion (around R16,500 crore).
At the time, Piramal had said this money would be channeled into businesses that provide high returns, and that in India, opportunities were everywhere. Since then, the company has also made two opportunistic investments in mobile telephony company Vodafone India, and now holds 11% in the latter.
PHL had come under pressure from investors following the Abbott deal, but in an interview to FE in October last year, Piramal justified the deal, saying My job as a trustee for shareholders is to ensure we get maximum returns.
On Monday, PHL shares closed 1.45% down on the BSE at Rs 443.80.
This is another step forward for the company in basic research, said Sarabjit Kaur Nangra, vice president (research) at Angel Broking, a domestic broker. PHL has been making investments in technology and in areas outside formulations, since they cannot enter that segment due to the non-compete clause with Abbott, she added.
The global molecular imaging market is as big as $5-6 billion, but the company will first seek approval from the US Food and Drug Administration for florbetaben, a PET imaging technique that helps detect traces of Alzheimer's Disease. PET or positron emission tomography is a nuclear medicine imaging technique that produces a three-dimensional image or picture of functional processes in the body. The approval will help commercialise the drug worldwide, Piramal said. There are other follow-on molecules in central nervous system, cardovascular and oncology, but the priority is to get approval for florbetaben, he added.
The future is of personalised medicine, which are much more targeted and different for each individual. Imaging will play an important role in this, said Swati Piramal, director, PHL. The field of molecular imaging is not very competitive yet, and had only US companies Lilly, GE Healthcare and Bayer in the segment. Only Lilly has a competitive product in Alzheimer's, but that too was very recently launched, said Swati Piramal.
This is PHL's second acquisition of late-stage assets after acquiring Canada's BioSyntech in 2011. The company said last week it got regulatory approvals to market cartilage repair product BST-Cargel in Europe.