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Pluristem Therapeutics, Inc. Message Board

  • allo.geneic allo.geneic Mar 26, 2013 5:46 PM Flag

    Why big pharma is busy acquiring injectables firms?


    March 20, 2013-BIOSPECTRUM

    Big pharma companies are gearing up to combat the shortage of injectables in the US through acquiring companies with approved manufacturing facilities. Last month, Mylan bought Strides Arcolab's injectable drug unit for $1.6billion, paying the highest ever for an Indian pharmaceutical company.

    According to Bloomberg, India-based Claris Lifesciences may be next in line to be taken over by one a pharma giant. Pfizer and Teva Pharmaceutical Industries have shown interest in acquiring this Ahmedabad-based company, which has five manufacturing facilities in Ahmedabad and has approval to ship drugs to the US.
    Manufacturing injectable drugs require sterile facilities to protect against unwanted contaminants and the US FDA has cracked down on manufacturers that fail to meet safety requirements. Mr Srinivasa Rao Aluri, managing director, Morgan Stanley, in a telephonic interview, said, "The interest in buying injectables unit is high because FDA shut down a number of sterile facilities in the US so now these companies do not have sterile facilities to combat the contaminants and this pressure is making them acquire injectables unit from other FDA approved companies." In 2012 alone, FDA had sent 22 warning letters to a number of companies.

    Ms Mridula Anand, researcher, Center for Leadership, Innovation and Change, ISB, believes that "With few players catering to niche segments, the injectables market poses high entry barriers to pharma and biotech companies. While due to stringent guidelines there are few FDA approved injectable manufacturing units in the US, the demand for sterile injectable drugs are growing. It is but natural for global firms to look towards India which have 'ready-to-run' sterile injectable drug manufacturing facilities."

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    • Take a look at Anteres pharma (ATRS). They have really good injectable designs.


    • The buyer can have pending points in the contract where they may withdraw the offer if the facility is not GMP certified in a certain time period.
      Not having certification until summer will not stop Pluristem to make a deal. imo

      Sentiment: Strong Buy

    • Another reason for the spur in the interest to buy injectables is that there has been drug shortage of it in the US. In 2011, there were 251 drug shortages reported in the US, out of which 183 involved sterile injectable medicines, as reported on the FDA website.

      The agency believes that a major reason for these shortages has been quality issues apart from other issues such as production delays, among others. FDA acknowledges the fact that with fewer firms making older sterile injectable drugs, there are a limited number of production lines that can make these drugs.

      This small number of manufacturers and limited production capacity for sterile injections result in drugs being vulnerable to shortage and thus prompting the big pharma to bridge this shortage gap by acquiring the injectables unit.

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