Sanofi Buying Brazil's Generic Drug Maker Medley
09.04.09, 12:09 Uhr
PARIS -(Dow Jones)- Sanofi-Aventis (SNY) Thursday announced plans to buy Brazilian drugmaker Medley in a deal that values the family-owned target at EUR500 million and will turn the French pharmaceutical giant into the top generics manufacturer in Latin America.
The move comes on the heels of Sanofi's purchase of Mexican generic drugmaker Laboratorios Kendrick for an undisclosed amount earlier this month and follows its purchase of Czech generics maker Zentiva.
The planned Medley acquisition is subject to certain conditions and expected to close in the second quarter.
Analysts said it's consistent with Sanofi's Chief Executive Chris Viehbacher's plan to look at acquisitions in areas like emerging markets and generics medicines in regional markets.
The French group said in a statement Thursday said that "this acquisition will enable Sanofi-Aventis to reinforce its number one ranking among pharmaceutical companies in Brazil, with a total 12% market share ... Sanofi-Aventis will become the leading player in the field of generics in Brazil and in Latin America."
Sanofi is an industry leader in the antithrombotic segment and its Lovenox and Plavix anticlotting drugs are forecast to be major growth drivers out to 2012. However, the group maturing core product portfolio will face generic competition beyond 2012.
Medley has a a generic portfolio of 127 products, positioning it to benefit from the growth of the Brazilian generic market, which is expected to remain over 20% per annum in the coming years, Sanofi also said.
In 2008, Medley's sales amounted to BRL458 million, or around EUR153 million, of which two thirds came from generic drug sales.
Analysts say the latest deal casts doubts on speculation that Sanofi is poised to bid for the pharmaceutical business of Belgian group Solvay (SOLB.BT).
Last week, Solvay confirmed it is "proceeding with an analysis of various options for its pharmaceutical activities." The statement came in response to a newspaper report that Sanofi-Aventis had directly approached Solvay's holding company, Solvac, with an offer for the pharma division.
Sanofi at the time declined to comment while Solvac denied it had received an offer.
Shares in Sanofi-Aventis have shed around 14% over a year-time on the back of the economic crisis and as investors called the company's strategy into question, before Viesbacher turned to the generic market. Shares closed Wednesday at EUR41.98 and at 0723 GMT they were down 1% at EUR41.51 in a slightly higher Paris market.
Company Web site: www.sanofi-aventis.com
The planned Medley acquisition is subject to certain conditions and expected to close in the second quarter.
Analysts said it's consistent with Sanofi's Chief Executive Chris Viehbacher's plan to look at acquisitions in areas like emerging markets and generics medicines in regional markets.
The French group said in a statement Thursday said that "this acquisition will enable Sanofi-Aventis to reinforce its number one ranking among pharmaceutical companies in Brazil, with a total 12% market share ... Sanofi-Aventis will become the leading player in the field of generics in Brazil and in Latin America."
Sanofi is an industry leader in the antithrombotic segment and its Lovenox and Plavix anticlotting drugs are forecast to be major growth drivers out to 2012. However, the group maturing core product portfolio will face generic competition beyond 2012.
Medley has a a generic portfolio of 127 products, positioning it to benefit from the growth of the Brazilian generic market, which is expected to remain over 20% per annum in the coming years, Sanofi also said.
In 2008, Medley's sales amounted to BRL458 million, or around EUR153 million, of which two thirds came from generic drug sales.
Analysts say the latest deal casts doubts on speculation that Sanofi is poised to bid for the pharmaceutical business of Belgian group Solvay (SOLB.BT).
Last week, Solvay confirmed it is "proceeding with an analysis of various options for its pharmaceutical activities." The statement came in response to a newspaper report that Sanofi-Aventis had directly approached Solvay's holding company, Solvac, with an offer for the pharma division.
Sanofi at the time declined to comment while Solvac denied it had received an offer.
Shares in Sanofi-Aventis have shed around 14% over a year-time on the back of the economic crisis and as investors called the company's strategy into question, before Viesbacher turned to the generic market. Shares closed Wednesday at EUR41.98 and at 0723 GMT they were down 1% at EUR41.51 in a slightly higher Paris market.
Company Web site: www.sanofi-aventis.com
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