Will become the fifth-largest generics company in Australia
Watson Pharmaceuticals has acquired Ascent Pharmahealth, the Australian and southeast Asian generic pharmaceutical business of India’s Strides Arcolab, for AU$375m (US$392m; €302m) in cash.
The purchase will make Watson the fifth-largest generics company in Australia and the second largest in terms of total molecules. It also becomes the largest generics company in Singapore and gains an established commercial base in Malaysia, Hong Kong, Vietnam and Thailand.
Ascent sells branded and non-branded generics plus over-the-counter and dermatology and skin care products in Australia, where it has a 14% market share. It employs around 300 people in Australia and southeast Asia and had total sales of approximately A$150m in these regions in 2011.
Watson’s president and chief executive Paul Bisaro said the firm wanted to expand into regions where ‘we can capitalise on our existing assets and participate in growing and emerging markets’. The acquisition ‘immediately establishes Watson among the leaders in the AU$12bn Australian pharmaceutical market, where the generic market is growing at approximately 8%’.
Watson currently operates in the Australian marketplace through its subsidiary Spirit Pharmaceuticals, which supplies products to third parties and also operates through its Willow Pharmaceuticals subsidiary, which develops, sources and markets products with an emphasis on injectables.
The Ascent purchase ‘catapults us to a top five position that would have taken considerable time and investment to build organically’, added Bisaro.
‘It also provides us with a leadership position in southeast Asia, a region with more than 600 million consumers and overall annual generic sales of approximately AU$4bn a year, which is projected to grow at more than 8% annually.’
Arun Kumar, executive vice chairman and group ceo of Strides Arcolab, said the deal would enable his company to focus on its ‘highly attractive steriles segment, which we expect to be our growth engine going forward’.