Pharma weekly wrap: A busy week with Aurobindo's US buyout and break-up of Singh brothers

It was an action-packed week for pharma and healthcare.

The biggest development of the week was India’s second-largest drugmaker Aurobindo Pharma's acquisition of commercial operations and three manufacturing units from Sandoz, a Novartis generic division, in the United States.

The acquisition, Aurobindo’s largest ever, comprises Sandoz’s dermatology business and a portfolio of oral solid products along with commercial and manufacturing infrastructure in the US for $900 million.

Aurobindo will be funding the entire acquisition through debt.

The net sales of the acquired business were around $1.2 billion for the calendar year ended December 2017.

The cheaper valuation of the acquisition target and Aurobindo's past track record in integrating and turning around acquired companies made most analysts and investors give was thumbs-up to the deal. The stock rallied by around 14 percent in last two trading days on the BSE.

India's largest drug maker Sun Pharma's Halol facility was back in the news — the US drug regulator has issued six Form 483 observations on the plant related to certain deficient procedures.

USFDA inspected the plant between August 27 and August 31.

Analysts tracking the company said the observations are resolvable and should not impact existing business or new approvals. The stock, which was down 5 percent at one point, recovered to end at Rs 664.20, dropping 1.84 percent. But what spooked investors is the plant getting the observations just after four months it resolved warning letter.

Shivinder Singh, the younger sibling, broke his silence on Tuesday, accusing his brother Malvinder and family friend Sunil Godhwani of systemically undermining the interests of the group companies and their shareholders.

Shivinder went a step further and filed a case against Malvinder and Godhwani in the National Company Law Tribunal (NCLT), alleging 'oppression and mismanagement' of RHC Holding, Religare Enterprises and Fortis Healthcare.

The NCLT admitted the petition, and ordered status-quo. But analysts say it's too late for Shivinder to get absolved from the mess the group finds itself in.

After a long wait, the government released the much-awaited draft rules for e-pharmacies. The draft rules will help regulate online sale of medicines across the country and provide patients accessibility to genuine drugs from authentic online portals.

The draft proposes that the Drug Controller General of India (DCGI) be the sole agency granting approvals to e-pharmacies with a validity of three years.

E-pharmacies are currently governed by state drug regulators.

The draft notes that e-pharmacies will have to pay Rs 50,000 to renew licences and the premises from where e-pharmacies operate will be inspected every two years.

The e-pharmacies are allowed to sell the medicines only against a prescription, a copy of which they will have to maintain.

The draft lays down some clear rules on data privacy and use of patient information.