Emcure Pharmaceuticals acquires Canadian company and its marketing arm Marcan

MUMBAI: Emcure Pharmaceuticals, a Pune-based drug maker, has acquired Canada’s International Pharmaceutical Generics Ltd. and its marketing arm Marcan Pharmaceuticals in a deal that’s expected to bolster the Indian company’s global expansion drive, according to people familiar with the development.

Emcure, which recently estimated its annual global sales at over $670 million, has widened its businesses from contract manufacturing to a strong presence in the domestic, US and European markets.

The company, incorporated in 1981, makes a range of drugs such as Asomex, used to treat blood pressure. Cardiology, gynaecology and anti-infective medicines account for a bulk of its portfolio.

Emcure did not comment on the deal. A questionnaire sent to Marcan Pharmaceuticals went unanswered until press time. Marcan Pharma, based in Ottawa, was founded by Atul Aggarwal and Nav Aggarwal and develops its own products and also distributes medicines under other labels. The company claims to provide customised pharmacy programmes.

Marcan Pharma has over 60 approved products that are mainly available via McKesson and Kohl & Frisch, among other wholesalers, it claimed. In 2014, Canada’s market for generic drugs was seen at $23.3 billion, constituting 67% of the prescriptions generated.

According to industry experts, Canada could be attractive for Emcure, although there could be challenges as the government aggressively implements a reference pricing system. Reference pricing is a model of setting prices based on the average price of drugs drawn from a set of countries that have similar healthcare infrastructure, health insurance and reimbursement policies.

“However, most of Emcure’s EU filings can get filed in Canada so synergy is good,” said an expert in international business.

Emcure’s entry into Canada is modeled on the strategy it had adopted for the US market with the acquisition of Heritage Pharmaceuticals in 2011.

From sales of $39 million in FY 2012, Emcure’s support to Heritage accelerated its US sales for FY 2016 to $265 million. Heritage has focused on niche opportunities with lower competitive intensity. However, the US business has seen major headwinds with the Food and Drug Administration issuing an import alert for its Indian manufacturing site.

Emcure has explored opportunities to go for a public listing in the past few years. It had filed a draft prospectus with the stock market regulator in 2013. During the same year, Blackstone sold its entire 13% stake in the company to Bain for about Rs 700 crore.