Dr. Reddy's snaps up eight generics from Teva for $350 million
- Indian drugmaker Dr. Reddy's will buy eight generic drugs from Teva and Allergan in a $350 million deal, as Teva seeks to divest itself of certain products in order to win approval for its $40.5 billion acquisition of Allergan's generics business.
- The purchase is one of the largest deals to date for Dr. Reddy's, which hopes to continue expanding in the U.S. One of the drugs has already received approval, while FDA decisions on the others remain pending.
- Teva is currently awaiting U.S approval of its generics deal, having already cleared regulatory review in Europe. Its agreement with Dr. Reddy's is contingent on the successful closing of its deal with Allergan.
In March, Teva won E.U. approval for its $40.5 billion generics acquisition after agreeing to divest assets in Ireland and the U.K. However, ongoing review by the U.S. Federal Trade Commission has delayed closing of the deal, and this sale to Dr. Reddy's is an example of the kind of divestments Teva needs to make in order to pass muster.
For Dr Reddy's, buying the eight drugs is a growth play intended to bolster its U.S. business. In the three months ending December 2015, net income and profit for Dr. Reddy's both increased slightly compared to a year prior.
“This transaction will add strength to our product portfolio, help us be more relevant in our U.S. market and also create new opportunities for growth," said G.V. Prasad, CEO of Dr. Reddy's, in a statement.
Branded sales of the eight drugs in the U.S. was approximately $3.5 billion over the last 12 months, the company said citing data from IMS health.