Aurobindo Pharma to acquire Sandoz US dermatology and oral solids divisions for $1bn

Aurobindo Pharma, a prominent Indian pharmaceutical company, has agreed to a significant acquisition from Sandoz US, a division of the Swiss pharmaceutical giant Novartis. The deal, valued at approximately $1 billion, involves the purchase of Sandoz’s dermatology business and a diverse portfolio of oral solid products, along with commercial and manufacturing infrastructure.

The transaction terms include an upfront payment of $900 million in cash and potential earn-outs of up to $100 million, contingent on the performance of the acquired products. This acquisition is strategically aligned with Aurobindo Pharma‘s objectives to strengthen its global presence and enhance its offerings in key therapeutic areas.

Through this acquisition, Aurobindo Pharma will inherit a robust dermatology franchise that encompasses a broad range of generic and branded products. Additionally, the deal includes a dermatology-focused commercial infrastructure, complete with a specialized sales force, and a manufacturing facility equipped with capabilities in creams, lotions, topical solutions, ointments, and topical suspensions. This facility is noted to complement Aurobindo’s existing manufacturing operations effectively.

The dermatology portfolio being acquired spans various therapeutic categories, including topical antibiotics, gynecological and dermatological antifungal agents, anti-itch and anti-acne treatments, local anaesthetic analgesics, and a dermatological chemotherapeutic agent. The oral solids portfolio enhances Aurobindo’s reach into several therapeutic areas, including anti-neoplastic agents, treatments for auto-immune diseases, and a variety of hormonal agents, among others.

N Govindarajan, Managing Director of Aurobindo Pharma, commented on the acquisition’s strategic benefits: “Acquiring these businesses from Sandoz will allow us to further expand our product offering and to become a leading player in the generic dermatology market. Overall, the transaction will position Aurobindo as the second-largest dermatology player and the second-largest generics company in the US by prescriptions.”

Aurobindo Pharma anticipates that this acquisition will not only enhance its pipeline of Abbreviated New Drug Application (ANDA) filings but also bolster its competitive position in the market. The company expects a seamless integration of the newly acquired businesses, reflecting the success of its previous acquisitions.

The completion of this acquisition is anticipated next year, pending customary closing conditions including approval from the Federal Trade Commission (FTC) among others.