) impending acquisition of Agila Specialties - the
injectable drugs division of India's Strides Arcolab - for
$1.6 billion in cash moved a step towards closure with clearances
from the India's Foreign Investment Promotion Board and the
Cabinet Committee on Economic Affairs. Mylan intends to fund the
deal through a $1 billion senior unsecured bridge term loan in
addition to its available cash balance and existing lines of
Through this deal, announced in Feb 2013, Mylan intends to
strengthen its presence in the high potential generic injectables
market. The deal is expected to close by year-end. At the time of
announcing the deal, Mylan had stated that the deal should boost
its 2013 adjusted earnings per share immediately after closure.
The global generic injectables market is highly lucrative and is
expected to grow at a compound annual growth rate of 13% from
2011-2017 with many drugs losing patent protection. The addition
of Agila should boost Mylan's injectable generic portfolio
significantly. The merged entity is expected to account for 70%
of the market demand for injectables.
Mylan, one of the largest players in the global generics market,
has a presence in more than 140 countries. As of Aug 22, 2013,
the company had 179 Abbreviated New Drug Application (ANDAs)
pending approval by the U.S. Food and Drug Administration,
representing $84 billion in annual sales. These include 42
first-to-file opportunities, representing $23.8 billion in annual
The data released by IMS Health is for the twelve-month period
ending Dec. 31, 2012. The successful completion of the deal with
Agila will boost these numbers significantly.
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Mylan's generic unit has seen quite a few launches over the past
few months. One of the important recent launches includes the
company's generic version of
) erectile dysfunction drug Viagra.
Mylan carries a Zacks Rank #3 (Hold).
) appear to be well placed in the generic space with a Zacks Rank