In a bid to enhance its basic pharmaceutical research, the Ajay Piramal Group will be buying a European drug firm, whose identity has not yet been disclosed. The European firm is set to offer assistance to the Piramal Group, following an alliance with various universities and public institutes. The formal announcement is expected today.
Piramal Group has been making their foray into the section of basic research, especially after the sale of their pharmaceutical business to Abbott Labs in 2010 for Rs 17,000 cr. The transaction amount has been stated to be anything between $50 million and $100 million. The deal is being spearheaded by Somesh Sharma, CEO of drug discovery and development. The business strategy of the collaboration will be headed by Peter D Young, the son-in-law of Ajay Piramal, who took over charge recently as company’s Vice-President. The Piramal Group deals with healthcare, drug discovery and research, glass, real estate, financial services. The company is estimated to have had a turnover of $900 million in 2010-2011.
Out of the Piramal Group, the Healthcare division has been known to be India’s largest healthcare group that recorded a growth of over 29% since 1988. Piramal Healthcare has been associated with the sale of anaesthetic products to more than a 100 countries. The company has property in Europe, Asia and North America which makes it the largest custom mechanized concerns of the world.
Of late, Indian drug companies have been making an investment in basic drug research. This follows years of expenditure a business model which simulated original and unproved drugs, relying on legal action and violent marketing to push merchandise after copyright expiry. However, this has suffered a serious setback, with Western companies fighting back to defend their market. This resulted in competition and and steep price falls that hurt the margins made by Indian companies. Major setbacks have also thwarted the earlier initiative planned by Indian companies to do their research.
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