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Merger And Acquisition Outlook

:
Pharmaceutical Industry India 2014
Presented By
Satyaki Roy
PRN: 05
M&A in Pharmaceuticals industry
• Shaping global pharmaceutical landscape- world 20s largest pharmaceuticals
companies involved in 17 megamergers ( deal larger than $10 billion) between
1995-2005








Positive impact of M&A in past and present Indian Pharmaceutical
market
• Changing significance of India’s domestic market for improving
global competitiveness and move up the value chain
• Increase their Product portfolio
• Acquiring assets( including research and contract
manufacturing, in order to boost their outsource capabilities)
and new products.
• Harness new product penetration in to new market
• Changing Disease profile and favorable demographics
• Export to regulated and semiregulated market

Successful M&A Deal: India
Pharmaceutical M&A increasing; India
Growing Sales market
• M&A Volume increase 53.1% in
Q1’14 compare to Q4’13
• 16 deal completed in Q1’14 (GSK &
Novartis; Bayer & Mercks)
• Strong equity markets, overall
economic stability, and trends within
the individual sectors are creating an
environment ripe for further investor
interest in the industry.

Why India?
• Low cost center for operation
developed as a active market
place and innovation center in its
own right.
• India with regards to other
emerging markets see as a spring
boards to assess regional South-
Asian, Middle East and even
African.
• Greenfield development in india is
time-consuming, opting for
acquisition.
Seller valuation expectations in
general are quite high. Sellers
know India’s potential, and bidders
must pay a premium for
market access
Reason for successful deal
• New government in place and the
(2014-15) Budget, the business
optimism is high for corporate India
and this is demonstrated through
the increasing M&A.
• High governance standards have
fetched premium pricing on deals
• Relaxation of M&A guidelines by
CCI.
• Globally requirement and changes
from the Affordable care Act result
41% M&A in Pharma
Sun Pharma to acquire Ranbaxy in $4 Bln
Reason for successful deal
• Diversified specialty and generic portfolio.( chronic and acute treatments)
• Enhanced global presence (47 mfg. facilities across 5 continents)
• Financially compelling transaction ( increase sun pharmecash earning/share and
Ranbaxy shareholder will participate in the value creation
• The synergies expected to result from topline growth, efficient procurement and
supply chain efficiencies with leverage human capital to drive future growth.