Novartis to acquire Fougera for $1.5 billion
pharmafile | May 3, 2012 | News story | Sales and Marketing | Fougera, Novartis, dermatology, generics, gilenya
Novartis will acquire the dermatology generics firm Fougera for $1.53 billion in cash.
Novartis’ generic unit Sandoz is conducting the deal, and the acquisition will make Sandoz the world’s biggest generics company focused on dermatology medicines.
A large amount of dermatology creams and ointments are losing patent protection, making companies such as Fougera a source of growth.
Fougera has an established expertise in dermatology development and manufacturing, with numerous launches planned for 2012 and beyond.
Novartis expects annual global sales of nearly $620 million, with sales primarily coming from the US – Fougera made $430 million last year.
The transaction requires regulatory approvals and is expected to be completed in the second half of 2012.
Jeff George, global head of Sandoz, said: “Fougera brings us valuable technical capabilities in the area of topical dermatological products, particularly in the development and manufacturing of semi-solid forms such as creams and ointments.”
This complements Novartis’ diversification strategy. This strategy saw the firm pay $13 billion for the ophthalmology giant Alcon, which made Novartis the biggest eye care specialist in the world.
It is one of several big pharma firms focusing on a broader portfolio of products and services to help shore up sales during a period of major patent expiries.
But not all firms are taking this route – Pfizer has said it is looking to sharpen its focus on prescription medicines and is currently shedding its animal, OTC and nutrition businesses in order to do this.
But Novartis’ strategy seems to be paying off. Analysts at EvaluatePharma predict that it will become the second biggest pharma firm by revenue this year, moving to the top spot by 2018.
This comes despite the patent loss of its biggest selling drug Diovan, and the downgrading of its multiple sclerosis pill Gilenya, which has been damaged by safety concerns.
The firm hopes that by having slower growing – but more steady – revenue from other businesses, it can help stave off the impact felt by patent losses.
Ben Adams
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