Sector News

Novartis follows brand offloading trend, selling drugs in Japan to Sun

March 30, 2016
Life sciences

India’s Sun Pharmaceutical is the beneficiary of one Big Pharma’s trends: companies offloading generally older brands to pick up some cash and keep sales folks focused on key treatment areas.

In this case, it is Novartis that is shedding products, having sold more than a dozen prescription brands to Sun in Japan, a market where Novartis has had its troubles.

Sun Tuesday said it will acquire 14 established prescription brands from Novartis for $293 million. The drugs, which span a number of therapeutic areas, had annual sales of about $160 million. Novartis will continue to distribute them until Sun arranges marketing authorizations and gets a local distributor.

“This acquisition marks Sun Pharma’s foray into the Japanese prescription market and provides us an opportunity to build a larger product portfolio in the future,” Sun Managing Director Dilip Shanghvi said in a statement.

For Novartis, it is following a path well-trod by Merck & Co.,, GlaxoSmithKline, Abbott Laboratories and others, who have hived off older brands that no longer fit into more focused goals, picking up billions of dollars in the process. AstraZeneca CEO Pascal Soriot has made an art of selling marketing rights to one or two products in specific markets. With AstraZeneca desperate for cash while Soriot tries to work some turnaround magic at the U.K. pharma, the company has done a series of deals for its “non-core assets.”

Most recently, AstraZeneca sold ProStrakan the rights to market a drug for opioid-induced constipation in Europe, Iceland, Norway, Switzerland and Liechtenstein. AstraZeneca gets $70 million and royalties in that deal. Last month, it pawned the rights to a couple of heart drugs to a Chinese company, raising $500 million while giving up what last year amounted to $246 million in revenue.

Up to now, Novartis Chairman Joerg Reinhardt has taken a more wholesale approach to unloading assets to narrow the Swiss drugmaker’s focus. In 2014, Novartis worked a deal to trade assets with GSK and also sold off the company’s animal health unit to Merck. The deals were valued at about $25 billion.

The Japan deal with Sun pales by comparison but comes at a time when the Novartis brand has been tarnished in that country by a couple of scandals. In 2014, Novartis’ Japanese affiliate was indicted along with a former employee for allegedly manipulating data in clinical trials for a blockbuster heart drug. Then in February 2015, the government suspended Novartis operations for 15 days as punishment for failing to properly report drug side effects.

By Eric Palmer

Source: Fierce Pharma

Related News

February 21, 2021

Sanofi invests in health tech firm Novadiscovery, boosting trial simulation platform and COVID-19 work

Life sciences

Novadiscovery uses its so-called JINKO platform that runs disease models on virtual patients to support decision-making and de-risk clinical development.

February 21, 2021

Gilead lets local HIV community groups take the lead with $3M grant

Life sciences

The pharma is pledging $3.2 million over two years to the Human Rights Campaign, the largest lesbian, gay, bisexual, transgender and queer (LGBTQ+) civil rights organization in the U.S.

February 21, 2021

Biotech company funds research project on diversity

Life sciences

In collaboration with Genmab, a new anthropological postdoc project at the Department of Anthropology will now explore and help develop the company’s efforts to ensure a diverse and inclusive workplace.

Send this to a friend