Swiss drugmaker Novartis announced today that it will buy Aspen Pharmacare’s Japanese generics unit in a deal worth up to €400m (£343.8m).
The deal, which will expand Novartis’ presence in the world’s third-largest drug market, will include a €300m upfront payment, with a deferred amount not higher than €100m to follow on completion of various conditions.
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Aspen’s Japanese portfolio is focused on anaesthetics and speciality brands, with a portfolio of 20 off-patent medicines with annual sales of €130m.
The move is part of the South African company’s attempts to reduce levels of debt, which stood at 40bn rand in June.
Sandoz, Novartis’ generics arm, will take on all of the company’s shares as well as its intellectual property.
“The acquisition of Aspen’s Japanese operations would significantly strengthen our position in this country, a stable but growing generics market,” Sandoz Chief Executive Richard Saynor said.
“We are committed to helping address patient and customer needs in the market as we aspire to become the world’s leading and most valued generics company.”
Sandoz is in the midst of a reorganization within Novartis, as chief executive Vas Narasimhan sells US generic pill and dermatology assets that had come under price pressure while simultaneously boosting the autonomy of the remaining businesses to help them compete better.
In addition, the company announced that Aspen had entered into a five year manufacturing and supply agreement with Sandoz for a number of products related to the divestment portfolio.
In September Aspen, which is South Africa’s largest drug manufacturer, agreed to pay £8m to the NHS for “anti-competitive behaviour.”
The CMA said it suspected Aspen had paid competitors to stay out of the market in 2016, enabling it to set prices.
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