PE firms keen on investing $3-4 billion in intermediate pharma companies: Report – Moneycontrol

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Overseas private PE players have prepared a war chest of $3-4 billion to inject capital into intermediate pharmaceutical companies in India after investing nearly $1.5 billion since the COVID-19 pandemic began.

IANS separately reported that the Indian Pharma Market (IPM) grew 59 percent yoy in April 2021 vs 16 percent yoy during the previous month, citing data from IMS Health. (Representational image: Shutterstock)

IANS separately reported that the Indian Pharma Market (IPM) grew 59 percent yoy in April 2021 vs 16 percent yoy during the previous month, citing data from IMS Health. (Representational image: Shutterstock)

Global private equity (PE) investors are keen on pumping money into Indian pharmaceutical companies that are into manufacturing active pharmaceutical ingredients (API), vaccine-related products and bulk pharma chemicals.

Overseas private PE players have prepared a war chest of $3-4 billion to inject capital into intermediate pharmaceutical companies after investing nearly $1.5 billion since the COVID-19 pandemic began, Mint has reported.

Moneycontrol could not independently verify the story.

“There is a huge demand emerging globally for companies that manufacture pharmaceutical ingredients. As much as $4 billion worth of funds could be forked out by global PE funds over the next 12-18 months,” a banker working for a foreign bank told the publication.

“The entire situation has changed and so has the investment strategy. A significant consolidation may be expected in the API and core bulk drugs businesses,” the banker said.

At least 15 PE funds have expressed interest in investing in API over the past few months, another banker told Mint. PE firms such as KKR & Co, Carlyle, Advent, Chrys Capital, and ICICI are keen on injecting capital in API, bulk and contract manufacturing companies, the banker told Mint.

Companies that manufacture APIs include Divis Laboratories, Laurus Labs, Granules India, Aarti Drugs, and Solara Active Pharma. Companies such as Sun Pharmaceuticals, Aurobindo Pharma, Dr Reddy’s Laboratories, Cipla, and Lupin manufacture generics.

India’s domestic pharmaceutical market is estimated at $41 billion in 2021, the report said.

the Indian Pharma Market (IPM) grew 59 percent year-on-year (YoY) in April 2021 against 16 percent in the previous month, news agency IANS reported, citing data from pharmaceutical market research firm IMS Health.

Moneycontrol News

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