Aspen Seeks Overseas Drugs Acquisitions as Deals Fuel GrowthJanice Kew
Aspen Pharmacare Holdings Ltd., Africa’s largest generic-drug maker, is considering further acquisition opportunities after international sales boosted profit, outweighing the rising cost of imported materials.
“There are a lot of opportunities” for deals, Chief Executive Officer Stephen Saad said by phone on Thursday. “Where we are really well positioned is that we can bring skills to the party. We can fix factories, we can fix operations and we have a good geographical presence.” The Durban, South Africa-based company is “looking the hardest” in Asia, he said.
Aspen, which supplies medicines in more than 150 countries, has spent in excess of $2 billion on acquisitions from drugmakers including GlaxoSmithKline Plc and Merck & Co. in the past two years as it expands its portfolio of medicines and manufacturing sites around the world. London-based Glaxo, an Aspen shareholder, took a stake in the company’s Japanese unit in October to boost operations in that country.
Acquisitions by pharmaceutical and biotechnology companies reached a record $239 billion last year, according to data compiled by Bloomberg, as buyers from Actavis Plc to Bayer AG picked up new assets.
“The restructuring and consolidation which is currently prevalent in the global pharmaceutical industry is creating a number of acquisitive opportunities,” Aspen said in a statement. “Executive management is actively engaged in assessing possibilities.”
Aspen is looking closely at infant milk, anticoagulant treatments and women’s health for deals, Saad said.
Net income climbed 27 percent to 2.46 billion rand ($208 million) in the six months through December, Aspen said. Sales increased 51 percent to 18 billion rand. The Asia-Pacific region accounted for 4.42 billion rand of revenue, more than the 4.31 billion rand from South Africa.
The shares gained 2.4 percent to 430.01 rand at the close in Johannesburg, valuing the company at 196 billion rand. Aspen’s share price more than tripled in the three years through 2014, and is up 5.9 percent this year. The drugmaker didn’t pay a half-year dividend.
The profit growth is “despite foreign exchange losses of 343 million rand caused by the U.S. dollar strengthening relative to the group’s major trading currencies,” Aspen said.