Unichem Shares Advance After Plan to Acquire Drug Brands to Boost Growth
Unichem Laboratories Ltd., an Indian maker of antibiotics and pain killers, advanced as much as 4.6 percent in Mumbai trading after saying it may acquire companies or brands to expand its product range.
The company may spend as much as 3 billion rupees ($65 million) to buy drugs for treating eye diseases and gynecological conditions, Gundu Rao, executive vice president of corporate affairs, said in an interview in Mumbai yesterday. It will also invest 600 million rupees to build a factory in the central Indian city of Indore to make heart and pain relief drugs for the U.S. market.
Unichem will hire 700 medical representatives in India, where it generates almost 75 percent of revenue, to expand its domestic sales force to 2,500 within the next two years, Rao said. The Mumbai-based company plans to start selling at least seven drugs in the U.S. this fiscal year, including a newly approved high-blood pressure treatment, to expand its offering in the world’s largest pharmaceutical market.
The company’s growth this year would “be higher than the markets growth,” Rao said without providing specific figures. The company expects to sell as much as $5 million of drugs in the U.S. this year, he said.
Unichem has six factories, two producing raw materials for medicines and four making finished products, according to its website.
The Indore plant is expected to produce tablets and capsules for export and start operations in 2013. Another facility in Goa will be used for research into monoclonal antibodies, which are bioengineered molecules that mimic the action of the body’s own response to infections, Rao said.
Rao said that the company is open to collaborating with other companies on marketing and contract manufacturing or research. Unichem hasn’t been approached regarding a possible takeover of the company, the executive said.
“We would continue to operate as an independent company and we are not up for any sale,” Rao said.
Batlivala & Karani Securities India Pvt. said in a June 16 report that Unichem received several proposals by overseas pharmaceutical companies and a tie-up may be announced in one to two months. Unichem Chairman and Managing Director Prakash Mody declined to comment at that time.
The Batlivala report came about one month after Abbott Laboratories agreed to buy Piramal Healthcare Ltd.’s branded generic-medicine unit in India for $3.72 billion.