Pharma aaquisition: Aurobindo to acquire dermatology and oral solids businesses from Sandoz Inc. for $900 million

Aurobindo Pharma’s US based subsidiary Aurobindo Pharma USA Inc has entered into a definitive agreement with Sandoz Inc., USA, a Novartis division, to acquire its dermatology and oral solids businesses for a consideration of US$ 900 million in cash including potential upside in near term earn-out and additional potential earn-out on pipeline product in outer years.

Acquisition will add approximately 300 products including projects in development as well as commercial and manufacturing capabilities in the US, complementing and expanding the group’s portfolio and pipeline.

The transaction is expected to close in the course of 2019 following the completion of customary closing conditions, including FTC clearance. 

Why this deal?

• The acquisition announced today is in line with Aurobindo’s strategy to grow and diversify our business in the US.
• Acquiring these businesses from Sandoz will allow Aurobindo to further expand our product offering and to become a leading player in the generic dermatology market.
• Overall the transaction will position Aurobindo as the 2nd largest dermatology player and the 2nd largest generics company in the US by prescriptions.
• The acquisition of Sandoz brands is in line with its strategy to strengthen and grow its global business and to expand and enhance its product portfolio offerings and key therapeutic areas. The acquisition will give Aurobindo a market leading dermatology franchise comprising a wide portfolio of generic and range of branded products which are well recognized by patients, pharmacists and retail/wholesale customers.

Aurobindo will also acquire a well-established commercial infrastructure with a fully-dedicated dermatology sales force along with a state-of-the-art manufacturing facility with specialized capabilities in creams, ointments, lotions, topical solutions and topical suspensions that are highly complementary to Aurobindo’s current manufacturing footprint.

The net sales of the acquired business were around US$ 1.2 billion for the calendar year ended December 2017.

The acquired generic dermatology portfolio covers a wide range of therapeutic areas including topical antibiotics, gynaecological and dermatological anti-fungal agents, anti-acne agents, local anesthetic analgesics, anti-itch, and dermatological chemotherapeutic agent.