The acquisition of the generics company for $263 million, would give Matrix a sales and marketing channel in Europe to complement its existing presence in the R&D and manufacture of active pharmaceutical ingredients (APIs) and solid oral dosage forms.
It is the second acquisition announced by Matrix this month. On 1 June, the firm announced its intention to merge with fellow Indian company Strides Arcolab and create the ninth largest Indian pharmaceutical company. Adding Docpharma to the stable would elevate it into the top 5.
Docpharma was founded in 1999 - by chief executive Leon Van Rompay and chief operating officer Stijn Van Rompay - with the aim of creating a top generic supplier for the Benelux region, where generics at the time were just being introduced. It currently has over 80 products in the pipeline that it plans to launch in the next 24 months - mainly in western European markets - and already has 50 registered products.
After the acquisition of the 22 per cent stake, scheduled to close by 8 July, Matrix will undertake an open offer to the Docpharma shareholders to buy the remaining 78 per cent of the Belgian firm.
Matrix CEO N Prasad said Matrix will retain Docpharma's brands and trade names in the latter's markets. The Van Rompays will remain CEO and COO of the company for at least five years.
Docpharma generates a majority of its pharmaceutical sales from the Belgian market, where, according to IMS statistics, it was the secondlargest generic company in 2004 with a market share in number ofprescriptions of 16.8 per cent. Generic drugs account for less than 5 per cent of the $4.4 billion (€3.6bn) Belgian pharmaceutical market, but according to Datamonitor, are expected to grow at around 16.5 per centannually through 2008.
Additionally, Docpharma also derives revenues from operations in theNetherlands and Italy, which represent a combined $2.9 billion generics market estimated to be growing at approximately 30 per cent a year. The Belgian company also has plans in place to enter the $2.5 billion Frenchgenerics market, which is estimated to be growing at 29 per cent annually.
Matrix said the acquisition would nearly triple its turnover in Europe to $103m out of combined sales for the two companies of $214m.