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Pharmaceutical Sector trends November 2017 - IndiaNotes.com
Pharmaceutical Sector trends November 2017
Equirus Securities | Published: 20 Dec, 2017  | Source : IndiaNotes.com
  •  Strong M&A momentum with strategic focus on bolstering domestic formulations

▪ Torrent (TRP) acquired the domestic portfolio of Unichem for INR 36bn; TRP maintains leading positions in cardiology / gastro / CNS therapies with market shares of 5.6% / 3.1% / 6.4% respectively

• With the Unichem portfolio acquisition, TRP’s shares in these therapies are poised to increase significantly

• We believe some synergies would be realized in the form of increases in drug prices, field force rationalization and improvement in sales-force productivity

(Unichem’s INR 0.27mn vs. TRP’s INR 0.72mn sales force productivity)

• Unichem’s domestic portfolio has been valued at 4.2x sales and ~20x EV/EBITDA – which we think is reasonable considering its existing margins of 20- 21% which can be easily expanded, and some legacy brands (Unienzyme, Ampoxin and Losar) which offer significant growth potential, as per the company

• Even in comparison to previous acquisitions in the domestic space, we think the deal is reasonably valued and believe the payback period would be more than 8 years

▪ Eris Latescence agreed to acquire Strides Shasun’s branded generics business for ~INR 500 cr

• Strides’ India branded generics business comprises of a portfolio of +130 brands in the domains of Neurology, Psychiatry, Nutraceuticals and Gastro

• The transaction augments Eris’ growing position in the CNS segment


  • Biocon became the first Indian company to receive a biosimilar approval in the US for gTrastuzumab

▪ First biosimilar approved in US for the treatment of breast cancer

▪ Biocon is partnered with Mylan on the development of a broad portfolio of biosimilar and insulin products


  •  CVS acquisition of Aetna

▪ In a transformational transaction, CVS, the US retail pharmacy and pharmacy benefit manager (the middleman between insurers and drug companies), announced the acquisition of Aetna, a leading health insurer, for US$69bn

▪ A vertically integrated CVS, further consolidates buying power in US – price erosion impacting Indian pharma players is unlikely to abate in the near term

  Read full report Click here to read the full report


About Equirus Securities

Equirus has built impeccable credential and market standing across domains & has created a niche for itself in its ability to structure and deliver transactions in-line with client’s requirement. It takes pride in being a one stop Investment bank for all financial needs of growth oriented mid market companies. Led by seasoned bankers, they work with the largest and the most reputed investors in the industry. Equirus Securities can be accessed at www.equirus.com


For more information please write in to editor@indianotes.com


Disclaimer: The author has taken due care and caution to compile and analyse the data. The opinions expressed above are only the views of the author, and not a recommendation to buy or sell. Neither the author nor IndiaNotes.com accept any liability whatsoever arising from the use of any of the above contents.