Glenmark Pharmaceuticals SA (GPSA), a wholly owned Swiss subsidiary of the Glenmark Pharmaceuticals Ltd, acquired an Argentine marketing company Servycal S A (Servycal) for an undisclosed consideration. This 100% all-cash acquisition, funded through internal accruals of GPSA, marks the direct entry of an Indian pharmaceutical Company for the first time ever in Argentina.

Servycal, with a focused oncology portfolio, will enable the company to expand its geographical scope and breadth of product offerings in the fast growing South American pharmaceutical markets. The Company owns a basket of seventeen approved product registrations with an additional three products pending registration. Apart from Argentina, Servycal's products are registered in 12 other South American country markets. The company is a marketing entity with a strong retail and hospital presence in Argentina, Servycal is expected to close FY 2005-06 with sales revenue of USD 4 mn and a net profit margin of about 10%, according to a company release.

Glenn Saldanha, Managing Director and CEO of the Company, commented, "Acquiring a front-end in key geographies such as Argentina, is a part of Glenmark's long term plan to emerge as a specialty /brand company marketing novel drugs, developed either in-house or in-licensed, in markets outside the USA, the EU and Japan. A detailed plan to derive synergies from the acquisition in the near term has been developed and includes leveraging Servycal's product portfolio across our other country markets, both within and outside South America."

Ailton Wiliczinski, President said, "The acquisition will strengthen our presence in South America and also help us develop a significant identity in the growing cytostatic market. By leveraging Servycal's and Glenmark's combined strengths and product portfolios, we are confident of growing the business in excess of 30% on an annual compounded rate over the next three years."

With projected sales of USD 10 bn and a CAGR of 13% [IMS May 2005], Latin America is a key geography in Glenmark's expansion plans in FY 2006. The Argentine pharmaceutical market is valued at USD 1.6 bn and is growing at the rate in excess of 10% [IMS, May 2005]. The therapy areas expected to drive much of the growth include Oncology and lifestyle diseases such as Diabetes, Cardiology and Dermatology, added the release.