Meiji Seika Pharma Co Ltd, a business subsidiary of Meiji Holdings Co Ltd of Japan, has set to acquire Medreich Ltd, India for a total consideration of Rs.1,720 crore ($290 million). Meiji Holdings and its affiliates have entered into a share purchase agreement with the promoters of Medreich which is indirectly own through Med Holdings (UK) Ltd, Nokha Holdings Pvt Ltd and V-Sciences Investments Pte Ltd owned by Tamasek Holdings, Singapore. Thus, Medreich will become a subsidiary of Meiji Seika Pharma and will retain its name.
Medreich has six manufacturing facilities built to comply with standards stipulated by International Regulatory bodies. The facility has been validated through successful inspections by the UK MHRA, Australia TGA, PICS, MCC South Africa, Canada Health resulting in cGMP compliance/certification/accreditations by these regulatory bodies.
Medreich is globally engaged in the contract manufacturing and contract development and manufacturing activities (CMO/CDMO) as well as the manufacturing and sale of generic drugs focusing on Europe, Asia, Australia and New Zealand, and Africa. Global major pharmaceutical companies like GlaxoSmithKline, Adcock Ingram, Pfizer, Sanofi, Novartis and Mylan are the major customers of Medreich. It is involved in the manufacturing and marketing of range of pharmaceutical produces in various dosage forms catering to diverse therapeutic categories including anti-infectives, multivitamins, analgesics and antihistamines.
Medreich's sales for the year 2013 increased by 15.4 per cent to US$ 157 million from $136 million in the previous year. Its net income moved up to $11 million from $7 million. Its total assets reached at $167 million.
According to Meji's spokesperson, generic drugs market is rapidly expanding due to the government policy of reducing medical expenditures. In Asia and other emerging countries, the demand for affordable pharmaceutical products is expected to remain strong. Therefore, there are needs to expand cost-competitive production capacity to meet such increase in demand. Furthermore, as outsourcing for cost reduction is increasing in the pharma industry, sustainable growth of the contract manufacturing business is expected globally.
The acquisition will be able to expand Meiji's CMO/CDMO business leveraging Medreich's blue chip customer base and the company's expertise in quality control and regulatory compliance, which has been cultivated through its long-term partnership with global pharmaceutical companies. The company plan to retain the existing employees at Medreich, who will play a key role in the future growth and development of the company. The acquisition will contribute to the realization of its 2020 Vision and increase the corporate value of Meiji Holdings.