Branded formulations major Eris Lifesciences Limited on Wednesday announced its foray into dermatology by acquiring 100 per cent stake in Mumbai-based domestic formulations company Oaknet Healthcare Pvt Ltd for Rs 650 crore.
The acquisition will be completed by way of a share purchase agreement as a result of which Oaknet will become a
wholly-owned subsidiary of Eris. The deal will be financed by Rs 300 crore of internal accruals and Rs 350 crore of borrowings.
With a revenue base of Rs 195 crore in FY22, Oaknet brings a portfolio of leading brands in dermatology and women’s health to the Eris stable.
The acquisition of Oaknet brings marquee brands like Cosvate and Cosmelite into the Eris portfolio, said Krishnakumar V, executive director & chief operating officer of Eris Lifesciences Ltd. "We expect to bring to bear multiple value creation levers including in-house manufacturing, new product launches, expansion of field force productivity and enhancement of operational efficiency,” he said.
The Oaknet acquisition will also provide an impetus to Eris’ specialty franchise with the latter now present in 87 per cent of the Rs 55,000 crore chronic market. Eris now has a leading presence in the major chronic therapies in the Indian pharmaceutical market, including in cardiology, oral diabetes care, insulin, neuro/CNS and dermatology.
With 100 per cent coverage and 60 per cent penetration of roughly 11,000 dermatologists across India, Oaknet has a pan India sales and distribution presence.
Commenting on the acquisition, Amit Bakshi, chairman & managing director of Eris Lifesciences Ltd said that in line with Strides and Zomelis acquisitions, the company is confident that the Oaknet transaction will create long-term value for shareholders. “As Oaknet becomes part of the Eris Group, it provides us with a robust growth platform in the areas of dermatology and cosmetology,” he said.
Eris posted a 17 per cent rise in its profit after tax at Rs 80 crore for the fourth quarter ended March 31, 2022 and 14 per cent at Rs 405.8 crore for the full financial year 2021-22, with quarterly and annual PAT margins of 26 per cent and 30 per cent, respectively.