Aurobindo Pharma buys Veritaz for Rs 171 crore to enter domestic formulation business

Drug maker Aurobindo Pharma on Monday said it has acquired the domestic formulations business of Veritaz for Rs 171 crore on debt free and cash-free basis.

This acquisition vehicle will greatly help Aurobindo as a launch pad for marketing biosimilar and other products in India, the company said in a statement.

The transaction comes into effect from April 1, 2022 and is expected to by May 2022, the company said.

Veritaz had a turnover of Rs 133 crore for the nine-month period ended December 2021 and it had a turnover of Rs 127 crore for the full year FY21. For the nine months ended December 31, Veritaz has reported revenues of Rs 131.2 crore, a growth of 4.9%.

Veritaz caters anti-infective and pain-management therapeutic areas and has a pipeline of products to enter into the cardio-diabetic, ortho and gynecology segments

"The addressable market of Veritaz’s current product portfolio is around Rs.26,775 crores which is an interesting space for Aurobindo to grow our business," Aurobindo said.

Veritaz has around 40 brands across the acute and critical care segments with a total number of 180 trademarks registered in its name. Its largest brands are Fepanil and Merogram.

The acquired business has more than 900 people including 700 sales
reps covering more than 50000 retailers with nearly 1700 stockist, presence in 23 cities, reaching out to more than 70,000 doctors and empaneled with major hospitals.

Vertiaz was founded on September '14, 2006 and so far promoters have invested more than Rs.80 crore to build up the distribution infrastructure and brands.

"The acquisition of the business by the Company is being done at an arm's-length price to supplement the company's plans to enter into the domestic formulations business," Aurobindo said in a statement.

"..with this acquisition; with this acquisition we strongly believe that with Aurobindo’s ability to built a product portfolio, and with the existing and expanding distribution network of Veritaz, we will be able to create a significant footprint in the domestic pharma market over the next few years,” said K. Nithyananda Reddy, managing director of Aurobindo.