Mumbai: Pharma company Wockhardt is set for a major rejig soon, which could involve a complete sale of its domestic business. The deal size could be around Rs 2,000 crore, sources close to the development told TOI.
Major drug makers including Cipla and Dr Reddy’s may consider buying the Mumbai-based company’s assets, the sources added.
When contacted, Wockhardt’s founder-chairman Habil Khorakiwala said, “We are looking at getting a joint venture partner, which may involve an equity infusion.” However, he refused to disclose more details saying they were confidential.
Wockhardt’s consolidated revenue for FY22 stood at Rs 3,250 crore as compared to Rs 2,894 crore (including Rs 54 crore from discontinued operations) in the previous year.
In 2020, Wockhardt had inked a deal with Dr Reddy’s, divesting select divisions of branded generics business in India and a few other international territories of Nepal, Sri Lanka, Bhutan and Maldives for Rs 1,850 crore.
As part of the deal, Wockhardt had sold a select portfolio of 62 brands in multiple therapy areas (respiratory, neurology, vitamins, dermatology, gastroenterology, pain and vaccines) to Dr Reddy’s.
“The company continues to retain a portion (of assets), which has helped them scale the business back. Over the last two decades, it has been focusing on new chemical entities (NCEs) in antibiotics, and has launched two novel antibiotics (EMROK and EMROK O) in India. It also has a robust pipeline of biosimilars, including insulins. The India business should be profitable and generate a good cash flow,” an industry expert said.
In the past, the company’s revenue and profitability was impacted in the wake of huge regulatory issues at its domestic and US plants. In 2013, the US FDA imposed a ban on two of its main plants — at Waluj and Chikalthana (both near Aurangabad). Four years later, its Ankleshwar plant had also come under regulatory glare for data integrity issues, destruction of records and other violation of good manufacturing practices
It took several years as well as massive efforts to regain lost ground.
Founded in 1967 by Khorakiwala, Wockhardt is now focused on high-growth anti-diabetic and anti-bacterial therapies. It has a significant presence in the UK, Europe and India, with over 80% of its revenues from international businesses.