Company Watch

Zydus enters the derma market

Our News Bureau - Mumbai

Zydus Cadila has acquired Mumbai-based, Liva Healthcare, a mid-sized, Indian pharma company with a derma focussed product portfolio. The group has acquired 97.5 percent stake in the privately held company. The all cash transaction will be funded through cash accruals and debt. With this strategic acquisition, Zydus Cadila will establish its presence in the Rs 1,500 crore derma segment which is the seventh largest therapeutic segment in the Indian pharma market.

The market for dermatology products has grown at CAGR of 14.1 percent over the last three years (IMS ORG MAT Dec '06). 11 of the 15 sub-therapeutic areas, constituting 76 percent of the derma market, are registering double-digit growth. The acquisition jumpstarts the group's operations in this hitherto unexplored segment.

Speaking on the acquisition, Pankaj R Patel, Chairman and Managing Director, Zydus Cadila said, "Our strategy over the last few years has also been to relentlessly focus and exploit opportunities for growth in the Indian pharma market. This acquisition unlocks great value for the group as it enables us to extend our expertise in a new therapy segment and cater to the needs of this segment. We see this as an opportunity to fortify our presence in the Indian pharma market and lead by extending our reach."

Liva Healthcare recorded a growth of more than 15 percent as per IMS (June 2006).

Derma products constitute 56 percent of Liva's therapeutic coverage. Liva also has a strong presence in the respiratory segment, which accounts for 24 percent of its TA coverage. The acquisition also includes Liva's GMP compliant manufacturing facility at Sinnar, near Nasik.

In yet another development, Zydus Cadila has received approval from the USFDA to market Paroxetine Tablets in different strengths of 10 mg, 20 mg, 30 mg and 40 mg. The drug, an anti-depressant falls in the CNS segment. The branded global sales of Paroxetine Tablets was estimated at $850 million. The company will market the drug through its US subsidiary Zydus Pharmaceuticals (USA). This marks the nineteenth ANDA approval for the group since the commencement of filing process in FY 2003-04.