Shanghai Fosun Pharma tables non-binding takeover offer for Gland Pharma

Shanghai Fosun Pharmaceutical (Group) Co Ltd today said it has made a non-binding takeover offer for Hyderabad-based injectable drugmaker Gland Pharma Ltd.

Gland Pharma founders and US private equity firm KKR jointly own about 96 per cent of the company worth between $1 billion and $1.5 billion.

Advent International and US-based Baxter International are also among suitors preparing to submit separate bids to buy Gland Pharma, Reuters reported.

Shanghai Fosun said that it has made the buyout offer through its unit Fosun Industrial Co Ltd.

KKR invested about $200 million in Gland Pharma in 2013 for a near 30 per cent stake, valuing the company at about $600 million. (See: US buyout firm KKR to invest $200 mn in Gland Pharma) The KKR transaction saw Gland Pharma's Ravi Penmetsa and other shareholders reducing their stake to a little over 60 per cent in the company.

Founded in 1978 as an exclusive facility for Small Volume Parenterals (SVPs), Gland Pharma is India's leading manufacturer of low molecular weight heparin and other niche products in the cardiovascular and orthopaedic segment.

The unlisted company set up an injectables facility in 1996 in collaboration with Vetter Group of Germany, Europe's leading contract manufacturing company for injectables in pre-filled syringes.

The collaboration provided Gland Pharma a technological edge in injectables and pre filled syringes.

The unlisted company has pioneered Heparin technology in India and is a leader in the GlycosAminoGlycans range of molecules.

The company manufactures active pharmaceutical ingredients and injectable formulations for niche segments such as osteoarthritis, anti-coagulants, gynaecology, and ophthalmology.

The company became the first in India in 2003 to get US Food and Drug Administration (FDA) approval for pharmaceutical liquid injectable products. The company also pioneered pre-filled syringe technology in India and exports products in the format to the US market.

Indian drugmakers are among the biggest producers of cheap generics. With developed nations battling rising healthcare costs and several blockbuster drugs going off-patent, indian manufacturers are increasingly eyeing the lucrative US market.

Since 2010, Fosun has spent billions buying foreign firms in the healthcare, tourism, fashion firms and banking industry in the US and Europe.

It owns US clothing label St John, Greek jeweller Folli Follie, US insurer Meadowbrook, a 5-per cent stake in the world's oldest travel company Thomas Cook, a controlling stake in French leisure company Club Méditerranée, and wholly owns US insurer Ironshore and Portuguese insurer Caixa Seguros.

It also holds a majority 95.6-per cent stake in Alma Lasers, an Israel-based manufacturer of lasers used in cosmetic surgery.

Shanghai Stock Exchange-listed Shanghai Fosun Pharmaceutical covers key aspects of the pharmaceutical and health industry chain, from research and development, pharmaceutical manufacturing, medical diagnostics and medical devices to the pharmaceutical distribution and retail and medical services for the public health contribution.