Morepen inks pact with Vésale Pharma to boost presence in Rs 1000 crore probiotics market
NEW DELHI: Indian pharmaceutical firm Morepen LaboratoriesBSE 1.40 % Ltd, listed on the Bombay Stock Exchange, has inked an exclusive agreement to market and distribute Belgian probiotics player Vesale Pharma International's major brands in the gastroenterology segment—a deal it hopes will help it strengthen its presence in India's growing probiotics market.
Gastroenterology is a branch of medicine that deals with disorders of the stomach and intestines.
Morepen, which currently does not have a presence in the probiotic market for gastroenterology, hopes to use its latest agreement to capture 5-10% of this segment by 2022, Morepen Chairman Sushil Suri told ET.
The gastroenterology segment of India's probiotic market is currently valued at Rs 1,000 crore and is expected to grow to Rs 8,000 crore in the next five years, he said.
Probiotic products contributed around Rs 1.5 crore of the Rs 120 crore Morepen drew in revenues for its finished formulations in 2016-17, according to him.
Under its latest agreement, Morepen will launch four of Vesale's major probiotic brands in India in the next two months—Bacilac Infantis, Bacilac ORS, Bacilac Forte and Cibalax. The companies said they will apply for regulatory approvals to market the products here now that the agreement has been finalised.
These brands are indicated in the treatment of conditions ranging from diarrhoea and dehydration to colic in kids and conditions ranging from irritable colon and constipation to antibiotic associated diarrhoea in adults.
While the companies did not disclose the prices for these brands, Suri said the products will be priced "at par" with the brands offered by multinational companies in India.
Morepen will set up a separate sales force to market these brands in the country and Vesale is expected to provide technical training.
"Probiotics are a new (therapeutic) area and...everywhere it is a booming industry," said Vesale Pharma Chairman Pierre Iweins.
While Vesale has only agreed to supply these brands for the time being, it may invest in setting up a research and development facility in India with Morepen for its entire range of products going forward, the firms told ET.
Morepen and Vesale are banking on the Belgian firm's patented 'Intelicaps' probiotic microencapsulation technology to aid in the sales growth of these brands. This technology, which Vesale has patented worldwide, is expected to ensure that the probiotics are not destroyed by acidity in the stomach and that they are able to safely reach the intestine to tackle the bad bacteria.
Around 60-70% of Vesale's revenue is from its current range of probiotics in the digestion segment and these products all use the Intelicaps technology, Iweins said.
The Belgian firm, which was founded in 1997, sells probiotic products in therapeutic segments like dermatology, gastroenterology, feminine health, pregnancy and immunity. It currently sells its products in over 20 countries, including China.
The global market for probiotics is valued at $40 billion (around Rs 2.6 lakh crore) and is expected to double in the next decade, according to him.