Sun Pharma, India’s largest drug maker, plans to expand its specialty business through licensing and acquisitions, according to Abhay Gandhi, CEO-North America Business. He stated that the company aims to fill portfolio gaps and achieve strategic goals judiciously through these methods. With a cash reserve of nearly $2.4 billion, including Taro’s $1.3 billion with zero debt, Sun Pharma is well-positioned for mid- to large-size transactions.
Sun Pharma has been developing its product pipeline in-house and plans to continue using both M&A and in-house development strategies. As of March 31, Sun Pharma’s consolidated net cash stands at $2.4 billion. The impending delisting and merger of Taro with Sun Pharma will allow the company to leverage Taro’s cash for further growth. Sun Pharma owns 78.48% of Taro and plans to acquire the remaining 21.52% stake for Rs 2,891.7 crore.
Specialty drugs, which provide targeted therapies for severe, chronic, and rare diseases, offer high margins due to their complexity and patent protection. For instance, Sun Pharma acquired US-based Concert Pharma for Rs 4,600 crore, gaining rights to Deuruxolitinib for treating alopecia areata.
As reported by The Economic Times, the development and commercialization of specialty drugs require significant investment in clinical trials, regulatory filings, brand building, distribution, and sales force. Despite these challenges, Sun Pharma’s specialty business has grown through licensing deals and acquisitions. In FY24, its global specialty sales, primarily from the US, surpassed $1 billion, contributing 18% of total revenue and growing 19% YoY. Ilumya (tildrakizumab), a key product for treating plaque psoriasis, reported $580 million in sales, growing 21.7% YoY.