Gland Pharma to leverage Fosun’s strengths for growth
MUMBAI: Gland Pharma aims to double its injectables capacity in the next two to three years before going public, a top company executive said a day after Chinese drugmaker Fosun Pharma said it acquired 74 per cent stake in the Hyderabad-based firm. Gland Pharma will also increase its product portfolios in India and regulated markets where it will go after the fast growing biosimilar drugs in areas like cancer and arthritis, leveraging the capabilities of Fosun Pharma, its managing director Ravindranath Penmetsa said.
Biologics and biosimilar drugs are emerging hotspots, and Gland is arming itself to take a leap in this segment, which is estimated to be the around $30 billion globally. The company is already working on the biosimilar of blockbuster rheumatoid arthritis drug Adalimumab and Bevacizumab, and there is a bunch of new chemical entities that Gland hopes to launch in the coming years, now that its excruciating 15 month “roller coaster” wait to complete all formalities of its takeover by the Chinese conglomerate finally got over.
Shanghai-based Fosun acquired 74 per cent of Gland for $1.09 billion after reworking the original deal that had envisioned the sale of a 86 per cent stake so that it could go through the automatic route under new foreign direct investment policy. Under the new agreement, Penmetsa, 58, will remain Gland’s CEO and MD for three years till its listing.
“They wanted a longer five-year commitment from me but we finally agreed on three years,” Penmetsa told ET in an interview. “The company is on an expansionist mode and we would leverage the strengths of a multinational like Fosun on the product as well as the marketing side.” One of the biggest advantage that Penmetsa sees in being bought over by an investment group like Fosun is a global reach that his company couldn’t have got on its own. It also gets access to China, the biggest drug market in the world which many Indian companies looked at with envy and inability to crack. Gland, which reported sales worth Rs 1,500 crore and EBITDA of Rs 649 crore for the last fiscal, is aiming to double its topline with a 30 per cent EBIDTA margin.
“There will be significant synergies in R&D and in APIs (active pharmaceutical ingredients) we are good at backward integration which we would leverage,” Penmetsa said.