DR Reddy’s Laboratories has entered into a definitive agreement with Israel-based Teva Pharmaceutical Industries and an affiliate...
DR Reddy’s Laboratories has entered into a definitive agreement with Israel-based Teva Pharmaceutical Industries and an affiliate of US-based Allergan to acquire a portfolio of eight abbreviated new drug applications (ANDAs) in the US for $350 million in cash. An ANDA is an application for a US generic drug approval for an existing licensed medication or approved drug.
Dr Reddy’s is acquiring the portfolio on a cash-free, debt-free basis and expects to finance the transaction using a combination of cash on hand and available borrowings under existing credit facilities.
In a statement, the company said the portfolio being acquired is a mix of filed ANDAs pending approval and an approved ANDA, and comprised complex generic products across diverse dosage forms. The combined sale of the branded versions of the products in the US is about $3.5 billion for the recent 12 months ended in April 2016, as per IMS Health.
“This transaction will add strength to our product portfolio, help us be more relevant in our US market and also create new opportunities for growth,” GV Prasad, co-chairman and CEO of Dr Reddy’s, said.
The acquired portfolio consists of products that are being divested by Teva as a precondition to its closing of the acquisition of Allergan’s generics business for $40.5 billion recently. The acquisition of these ANDAs is also contingent on the closing of the Teva/Allergan generics transaction and approval by the US Federal Trade Commission of Dr Reddy’s as a buyer.
“Dr Reddy’s has a strong track record in the US market with over 79 filed ANDAs pending approval, of which we believe 18 have first-to-file status. The acquisition of these attractive ANDAs from Teva will enhance our short-to-mid-term aspirations and is consistent with our growth initiatives to identify inorganic opportunities to expand our base business,” Alok Sonig, executive vice-president and head of North America, said.