Cabinet clears Mylan's Rs 5,168 cr deal to acquire Agila

New Delhi: US-based Mylan Inc’s Rs 5,168 crore deal to fully acquire Bangalore-based pharma firm Agila Specialities, a subsidiary of Strides Arcolab, was given a go ahead by the government today.

The decision was taken at a meeting of the Cabinet Committee of Economic Affairs (CCEA).

“The approval would result in foreign investment amounting to Rs 5,168 crore in the country,” an official statement said.

Mylan has presence in India through its subsidiaries, Myland Laboratories Ltd, Mylan Pharmaceuticals Pvt Ltd and Astrix Laboratories Ltd.

The US-based company announced the deal in February. As part of a definitive agreement signed between Mylan and Bangalore-based Strides Arcolab, apart from the acquisition amount in cash there is also a provision for additional $250 million in potential payments.

Mylan had set the fourth quarter of 2013 as the expected time for the transaction to be completed subject to regulatory approvals.

The acquisition is however subject to certain conditions, according to sources.

Mylan has to maintain the investment level in R&D in value terms for five years at absolute quantitative level at the time of induction of FDI, sources said.

Further, the US-based firm would also have to maintain the production level of National List of Essential Medicines (NLEM) drugs and consumerables and their supply to domestic market at the time of induction of FDI for the next five years at an absolute quantitative level.

Agila is engaged in development, manufacturing, marketing and sale of generic pharma products, particularly oncological.

Announcing the deal, Mylan had said that Agila will bring a broad product portfolio of more than 300 filings approved globally and marketed through a network covering 70 countries, including 61 abbreviated new drug applications (ANDAs) approved by the US Food and Drug Administration (USFDA).

Agila currently produces products at nine manufacturing facilities in India, Brazil and Poland, eight of which have been approved by the FDA.

Mylan, on the other hand has more than 500 products marketed globally, including 55 ANDAs, and its has sterile manufacturing facilities in Ireland and India.

PTI