Sun Pharma sells Ranbaxy's CNS business for Rs 165 crore

To streamline its business, Sun Pharmaceu- ticals has sold the central nervous system (CNS) product business of erstwhile Ranbaxy to Strides Arcolab for Rs 165 crore. Ranbaxy had merged with Sun Pharmaceuticals earlier this year.

Under the deal, Solus and Solus Care divisions will be transferred to Strides Arcolab, which will also absorb about 200 employees working in these divisions. The two divisions had an annual sale of about Rs 92 crore, according to IMS data for July.

The CNS segment is the oldest of the product divisions in Sun Pharmaceuticals and it has annual sales of about Rs 1,300 crore. Sun Pharmaceuticals began operations in 1983 with five psychiatry products and a two-person marketing team.

Last week, Sun Pharmaceuticals had announced its intention to sell its manufacturing plant in Ireland, which was owned by Ranbaxy. Sun Pharmaceuticals said it was looking to close or divest some more facilities to rationalise its manufacturing footprint.

The acquisition will enable Strides Arcolab to get a strong footing in the CNS segment. It is the company's second acquisition this year.  In March, the company acquired generic pharmaceutical business of Aspen Pharmacare of Australia in a deal valuing Rs 1,900 crore. Last year, Strides Arcolab acquired Shasun Pharmaceuticals in a Rs 2,500-crore deal and is awaiting mandatory approvals for the transaction.

Subroto Banerjee, president — brands, India, Strides, said, “The acquisition of the Solus and Solus Care divisions is of strategic significance to the growth of our branded business in India. The rich product portfolio and capable teams of these two divisions will help us establish a strong footing in the fast growing CNS market of India. The product portfolio of Strides and these divisions will strategically complement each other very well.”

“Post-successful completion of Ranbaxy’s merger, we had an opportunity to assess the entire portfolio of our India Business. We have evaluated each and every therapy segment that we are present in and how these businesses can grow going forward. Based on this evaluation, we firmly believe that the potential of Solus and Solus Care divisions can be greatly enhanced with the focus that Strides will put in growing them. The divestment will help these divisions, its customers and the team,” said Abhay Gandhi, CEO, India Business, Sun Pharmaceuticals. 

RESTRUCTURING EXERCISE

• CNS segment is the oldest product division in Sun Pharmaceuticals. It has annual sales of about Rs 1,300 cr
• Sun Pharma is looking to close or divest some more facilities to rationalise its manufacturing footprint post its merger with Ranbaxy