Glaxo in $250m Argentine buy

City A.M. Reporter
BRITISH drugmaker GlaxoSmithKline stepped up its drive into emerging markets with the acquisition of Argentina’s Laboratorios Phoenix for $253m (£172.4m) yesterday.

The latest in a string of deals in developing markets gives Glaxo a portfolio of branded generics covering therapeutic areas such as cardiovascular, gastroenterology, metabolic and urology.

Phoenix also brings Glaxo a factory near Buenos Aires, a primary care sales force and pipeline of additional branded generic medicines.

Emerging markets are the new battleground for the world’s top drugmakers as sales stall in Western markets – and Glaxo has vowed to increase its business, partly by moving into the sale of off-patent branded medicines.

Phoenix had sales last year of around £70m, ranking it number eight in Argentina’s pharmaceutical market, while Glaxo’s Argentine business had revenue of £100m. Combined, GSK Argentina and Phoenix would rank third in the Argentine market.

“This is an important step forward in our strategy to grow our business in Latin America – a key group of emerging markets for GSK,” said Abbas Hussain, the company’s head of emerging markets.

Following the acquisition, GSK Argentina and Phoenix will remain separate legal entities.

Last month, Glaxo agreed to buy a 9.9 per cent stake in South Korean group Dong-A Pharmaceuticals for £73.9m, the latest of a string of deals designed to increase its share in up-and-coming markets worldwide.

Other deals have included the acquisition of branded generics from both Bristol-Myers Squibb and UCB, and product deals with Dr Reddy’s of India and South Africa’s Aspen Pharmacare. The balance of the pharmaceutical market is expected to shift significantly toward emerging markets in the next five years.