Aurobindo to acquire parts of Sandoz US

Aurobindo Pharma has signed a definitive agreement to acquire certain assets from Sandoz Inc, US, a Novartis division, for $900 million. The proposed acquisition comprises Sandoz’s dermatology business and a portfolio of oral solid products along with commercial and manufacturing infrastructure in the US.

The acquisition will be debt- and cash-free and will be made through Aurobindo’s wholly-owned subsidiary in the US. It will position Aurobindo as the second largest dermatology player and the No 2 generics company in the US by prescriptions.

The acquisition will include a portfolio of dermatology and oral solids, authorised generics and in-licensing products, branded dermatology products, three manufacturing facilities — at Hicksville, Melville and Wilson — and 100 percent shareholding in Eon Labs Inc, a wholly-owned subsidiary of Sandoz. This will add approximately 300 products, including projects in development as well as commercial and manufacturing capabilities in the US.

The transaction is expected to close in 2019 following approval from various bodies including the US Federal Trade Commission (FTC). After the expiration of certain in-licensed product contracts and rationalisation of acquired products that will not hurt profitability (but before the impact of any potential FTC-led divestments).