Lupin plans expansion, eyes Europe growth via acquisitions and launches

Lupin is planning launches and product acquisitions to give a fillip to its European business. “The company is exploring potential products that treat underserved neurological conditions,” Lupin’s President in Europe and Middle East Thierry Volle said. 

Another growth driver would be product launches, including biosimilar Etanercept, to treat rheumatoid arthritis and a rare muscle disorder drug called NaMuscla. Both the launches are expected in 2019.

Recently, Lupin received a positive opinion from European regulator, which recommended marketing approval to NaMuscla – a drug to treat a muscle disorder. The drug is for non-dystrophic myotonic disorders, a rare disease which impacts around 7,500 persons in Europe. Upon launch, it will be the first licensed treatment for the disease across the continent. 

European governments follow different policies for pricing and reimbursement and there have been issues regarding high cost and availability of drugs to treat rare diseases. Lupin said it will seek a harmonised value-based pricing for the drug across Europe but did not indicate the product’s sales potential. 

The pharma major acquired a portfolio of central nervous drug system drugs, including NaMuscla, through its acquisition of German drug maker Temmler Pharma in 2015. This was the company’s second buy in the country after buying Hormosan Pharma in 2008. Volle said the company is building a diversified portfolio of complex generics, specialty drugs and biosimilars in Europe. He said Lupin’s strategic focus on specialty drugs includes women’s health and neuroscience for the US and Europe, respectively and the company will explore new markets based on potential for those treatment areas.

Lupin’s push in Europe comes at a time when it is battling the slowdown in the US, its key market. Revenue from the US market declined 27 per cent in FY18 over the previous year due to ongoing challenges. With Rs 540 crore revenue, Europe accounted for 3.5 per cent of Lupin’s consolidated sales in FY18 but it was among the fastest-growing major market for the company that year, registering 20 per cent growth. 

Sales were driven by growth in specialty and generic drugs in Germany, the largest pharmaceuticals market in Europe.

Other Indian companies, too, are pursuing growth opportunities in the market through acquisitions and product in-licensing. In 2017, Ahmedabad-based drug maker Intas lapped up the generic drug portfolio in the UK and Ireland from Actavis for $764 million.  In the same year, Aurobindo Pharmaceuticals acquired Portuguese drug maker Generis. Glenmark is launching a generic version of Glaxo Smithkline’s blockbuster inhaler Seritide in various European countries following a tie up with Polish firm Celon.

According to IQVIA, a global health care services firm, overall drug spend in Europe was around $154 billion in 2017, making it the second-largest market after the US. The spend is expected to grow at a compound annual growth rate of 1-4 per cent and will reach $170-200 billion in 2022. Ageing population, incidents of chronic ailments and adoption of specialty medicines are set to drive growth.