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Sunday 16 June 2013

Dr Reddy's, Fujifilm call off alliance

This story first appeared in DNA Money edition on Tuesday, Jun 4, 2013.

Dr Reddy’s and Fujifilm have called off their partnership to tap the generic drugs market in Japan after almost two years of planning and market analysis.

The companies had in July 2011 inked a memorandum of understanding (MoU) with plans to seta joint venture for developing and manufacturing drugs in Japan and had even conducted studies on business aspects.

“However, as Fujifilm realigns its long-term growth strategy for the pharmaceutical business, both companies have led to a mutual agreement to terminate the MoU,” the companies said in a joint statement on Monday.

GV Prasad, chairman and CEO, Dr Reddy’s Laboratories, called it an unfortunate development. “However, I want to reinforce our commitment towards a planned entry into Japan to bring affordable and innovative drugs to more patients worldwide,” he said.

The companies will continue to explore partnerships in other pharmaceutical businesses, the statement said.

“In the long-term we will be focusing more on priority fields such as new drugs in cancer, more value-added super generic,” said Takatoshi Ishikawa, director corporate vice-president and general manager of pharma products division, Fujifilm.

Analysts made light of the development. “We haven’t changed our estimates on Dr Reddy’s given the JV does not contribute anything,” said Sarabjit Kour Nangra, VP-Research, Pharma, Angel Broking.

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