France's Sanofi entered into a license agreement with Glenmark Pharmaceuticals to develop and market a new biotech drug to treat Crohn's disease and other chronic autoimmune disorders on Monday. The deal has a potential to generate USD 613 million or Rs 2,734 crore.
Globally, pharma giants are choosing the joint venture road to make the most of the consumption story in India, one of the world's promising markets, as high valuations are causing hinderance for merger and acquisition deals. Pharma stocks, of late, have witnessed a substantial spurt on news surrounding these deals.
Chirag Talati, analyst at Espirito Santo Securities Pharma, in an interview with CNBC-TV18's Sonia Shenoy and Anuj Singhal, gave his perspective on the Glenmark-Sanofi deal and why he is bearish on Dr Reddy's and Ranbaxy. Below is the verbatim transcript of his exclusive interview. Also watch the accompanying video. Q: Analysts indicated the reaction on Glenmark as 'sentimental' and said it is a little premature to analyze what kind of an upside the stock price would see-what is your version on the deal?
A: It is a good deal for Glenmark. Given the fact that Sanofi has returned to do a deal, after signing up for TRP franchise in 2009, is an indicator that it has confidence in the process Glenmark adopts. However, the molecule is at a nascent stage. Crohn
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