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Pharma overseas buys top $400 mn

Sun Pharma, which on November 29, 2005, emerged the highest bidder for acquiring the assets of Able Labs in the US with $23 million, may provide the perfect topping to a year in which Indian pharma companies have already notched up overseas acquisitions worth an all-time high of $400 million. In 2004 the corresponding figure was $155 million.

Analysts say Indian companies are leveraging their cost competitiveness in sourcing bulk drugs and easy access to funds like never before. The aim is to tap overseas markets, expand the geographical reach and enhance the intellectual property portfolio needed to survive in the post-patent era.

“The high price-earnings values of pharma companies and cost arbitrage opportunity are behind this strong performance,” said Sanjiv Kaul, ChrysCapital managing director.

With Indian stock markets at an all time high, the market capitalisation of Indian firms has shot through the roof, increasing the leverage of their equity.

The total worth of overseas acquisitions for this year has been buoyed by the single biggest overseas acquisition ever by an Indian pharma company, that of Docpharma in Belgium by Matrix Laboratories.


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