Mumbai (PTI): Sun Pharma, which concluded the buyout of Ranbaxy Labs, has said that the combined entity will now focus on R&D capabilities and global presence that would lead to a value accretion of $250 million over three years."The merger of Sun Pharma and Ranbaxy will create a $4.5 billion entity. We will expand our R&D capabilities to introduce new innovative products and expand our global presence, especially across the emerging markets," Sun Pharma founder and MD Dilip Shanghvi told reporters here on Wednesday.
The company is also looking at enhancing the product portfolio and increasing reach in domestic market as well as, the US and the rest of the world, Shanghvi said, adding that it will pursue partnerships and strengthen the M&A bandwidth."We have also formalised an operational blueprint for realising $250 million synergy target for three years through significant value creation across functions. The integration will cover all functions and markets globally," he added.
"The combined entity will capitalise on the expanded global footprint and enhance our dominance as a world leader in the speciality generics landscape," Sun Pharma chairman Israel Makov said.The combined entity's manufacturing footprint covers five continents with products sold in over 150 nations with a stronger presence in the US, India, Asia, South Africa, CIS & Russia and Latin America. "The new company will have large manufacturing footprint. Currently, Ranbaxy outsources around 40 per cent of its products, which will be stopped completely shortly. The idea is to become a low-cost drug maker," Shanghvi said.
The company is awaiting regulatory approvals for nearly 150 products in the US. It is also looking at increasing its presence in Europe and investing in new OTC brands in Russia, Shanghvi said.Following the closure of the transaction, Ranbaxy will be delisted from the stock exchanges and Ranbaxy shareholders will receive 0.8 Sun Pharma shares for every Ranbaxy share they hold.Commenting on regulatory issues, Shanghvi said, "We are working with global consultants for compliance aim. We will continue to focus on gaining trust of the regulators globally while continuing to develop products based on patient needs and leverage them to become brand leaders globally."Ranbaxy has been facing issues raised by the FDA and other American authorities and health regulators in the European markets.
Post-merger, Daiichi Sankyo becomes the second largest shareholder in Sun Pharma and both the companies will work together to leverage this relationship for global business growth, he said.Sun Pharma is not looking at restructuring combined entity, Shanghvi said, adding that each leadership team member will lead an expanded functional management team. This functional leadership pipeline draws best of talents from both Sun Pharma and Ranbaxy identified through detailed capability assessment undertaken by a global talent management firm.
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