Singh: Drug deal

Mumbai, May 28: Ranbaxy Laboratories has acquired the US brand rights to 13 dermatology products from Bristol-Myers Squibb Company for an estimated consideration of $26 million. The acquisition was made by wholly owned subsidiary Ranbaxy Laboratories Inc.

“The rights are only for the US market. We have paid $26 million for this and revenues from these products are about $15 million,” Ranbaxy Laboratories Ltd managing director and CEO Malvinder Mohan Singh said.

He said the revenues from the products would start accruing into the company’s account by the end of this month.

According to Ranbaxy, these products have been present in the market for over 10 years and have been used in the treatment of acne, dermatitis, psoriasis, fungal infection and scabies. The US dermatology market value is estimated at $10 billion with an annual growth of 10 per cent.

Ranbaxy has a strong presence in the acne segment. Its Sotret Isotretinoin Capsules USP is used in the treatment of severe recalcitrant nodular acne. Sotret is the largest selling brand in its category with a market share of over 36 per cent.

Venkat Krishnan, vice-president and regional director for Ranbaxy in North America, said, “The acquisition strengthens and extends the Ranbaxy franchise in dermatology. It enables the company to establish an immediate presence in the high-value segments of dermatitis, psoriasis, anti-fungals and scabies in addition to acne, where the company already has a dominant brand.”

He added that these products would create opportunities that could be effectively leveraged through the company’s current franchise established through Sotret. It is also felt that the business opportunity, generated from the acquisition of these brands, will create a broader platform for the introduction of value-added line extensions and additional brands in dermatology. “It underscores our strategy of pursuing inorganic growth opportunities to complement internal growth,” he said.

The company said the 13 products have significant synergy and represent an opportunity to build a dermatology business with a predictable revenue stream. These brands will be sold in the US under the Ranbaxy Laboratories Inc label and offer significant potential for growth. Ranbaxy feels that incremental sales from the 13 products can be generated through active promotion.

Ranbaxy Laboratories Inc is based in Princeton, New Jersey. It sells and distributes branded prescription products in the US healthcare system.