Sun Pharmaceutical plans to purchase a portion of Novartis branded products in Japan

Will gain a foothold in Japan with speciality dermatology drugs anda portfolio of generics

India's largest drugmaker, Sun Pharmaceutical, is in advanced talks to buy a portion of Swiss drugmaker Novartis' portfolio of branded products in Japan in a deal estimated at US$300m.

Sun Pharma is sitting on $2bn of cash and if the deal goes through, it will help Sun gain a beachhead in the world's second-largest medicines market with its speciality dermatology drugs and its portfolio of generics.

After releasing its second quarter results, Sun's Managing Director Dilip Shanghvi said the firm was evaluating opportunities to expand its global footprint. A possible deal with Novartis might enable Sun to realise its Japanese goals.

Reports indicate that Japan contributed 7% to Novartis’ total sales of $58bn in 2014.

Around $14bn–$16bn worth of drugs are coming off patent in Japan over the next two years. This, coupled with increased penetration of generics, should help Sun achieve some traction in this market.

Sun's move into Japan will help the company diversify its geographic presence. Currently India and US, its core markets, account for 75% of sales.

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