INDIA –Panacea Biotec Pharma Limited, a subsidiary of Panacea Biotec Limited, has agreed to sell its domestic formulations business to Mankind Pharma for Rs. 1,908 crores (US$252.4 million).
Panacea Biotec, which manufactures the Sputnik V Covid-19 vaccine, has been battling Piramal Enterprises and the India Resurgence Fund (IndiaRF) to repay a Rs 750 crore (US$99.1 million) debt.
It has now sold its subsidiary Panacea Biotec Pharma’s domestic formulations business, including formulations brands in India and Nepal, as well as related trademarks, copyrights, to Mankind Pharma for Rs 1,908 crore (US$252.4 million) exclusive of taxes.
The divestment will ensure adequate liquidity for these businesses, drive investments in products under development and expanding capacities for key vaccine projects to drive future growth in a sustainable manner.
The sale of Domestic Formulation Brand portfolio is in line with the Company’s strategic plan to become debt free and focus on exports of Pharmaceutical formulations in US and other international markets besides the vaccine business in global markets.”
parties intend to execute the asset purchase agreement for the Transaction on or before February 27, 2022.
The transaction is expected to close during the current fiscal year.
According to stock exchange disclosures, Panacea Biotec Pharma Limited’s domestic business generated a total revenue of 219.85 crore (US$29 million) in the previous fiscal year.
This represents 63.75 percent of PBPL’s revenues and approximately 35.19 percent of parent Panacea Biotec Limited’s consolidated revenues.
Notably, Panacea Biotec is one of six companies that have formed alliances with the Russian Direct Investment Fund (RDIF) to develop the Covid-19 vaccine Sputnik V.
Mankind Pharma Ltd has agreed to retain Panacea Biotec’s sales and marketing team in this business as part of this agreement.
“Panacea has created a niche in the chronic and transplant business, and their products are inherently supported by highly complex and distinctive technology,” said Rajeev Juneja, Managing Director and Vice Chairman, Mankind Pharma Ltd.
With this acquisition, Mankind Pharma will be able to explore new therapeutic areas and gain visibility in the lifestyle, oncology, and transplant business.
Meanwhile, Serum Institute of India, which owned 8.59% of Panacea Biotec in December 2021, sold 358,000 equity shares on the NSE for Rs 278.15 (US$36.8 million) last month.
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