Novartis Sells Sandoz US Assets to Aurobindo
Novartis has agreed to sell parts of its Sandoz US portfolio to Aurobindo Pharma USA as the Swiss drugmaker drives ahead with its strategy to focus on higher value medicines.
Aurobindo will pay $900 million in cash plus another $100 million in potential earn-outs for the Sandoz US dermatology business and generic US oral solids portfolio. Aurobindo Pharma’s managing director, Narayanan Govindarajan, said the deal will position his company as the second largest dermatology player and the second largest generics company in the US by prescriptions.
The sale includes approximately 300 products as well as additional development projects and manufacturing facilities in Wilson, North Carolina, and Hicksville and Melville, New York. The business had net sales of $600 million in the first half of 2018.
As part of the agreement, roughly 750 employees in Hicksville, Melville, Wilson and Princeton, New Jersey, as well as the field representatives for the PharmaDerm dermatology business, are expected to transfer to Aurobindo. The transaction is expected to close during 2019.
“Sharpening our portfolio focus in the US allows us to devote more time and resources toward our strategy of bringing complex generics, value-added medicines and biosimilars to patients in the US, creating higher value and opening up access to important medicines where alternatives are truly needed,” said Richard Francis, Sandoz CEO and member of the Novartis executive committee.
“Through this transaction, we are refocusing our business but also striving to ensure continuity of supply of important long-used generic medicines for patients and customers in the US,” Francis added.
Since Vas Narasimhan took over as CEO of Novartis on Feb. 1 2018, he has sold a 36.5% stake in a consumer joint venture with GlaxoSmithKline and announced plans to spin off its Alcon eyecare unit.