**[investwise]** Abbott Labs Fills In A Prescription-Sell Generics To Indians, Made In India

 

Abbott Labs-Looking At A Rs 2000 stock, one year down the line BSE 500488 Abbott Laboratories can effectively consider itself as holding a 7% share of India's drug market after its $3.7 billion acquisition of the domestic pharmaceutical business of Piramal Healthcare. With the latest deal, Abbott Labs Inc.USA, will have 3 operating entities in India-Abbott Labs (BSE listed), Solvay Pharma (BSE listed), Abbott India (100% WOS) which incidentally will absorb the Piramal business, making the US TNC one of the biggest players in the Indian generic market. Investors are hoping that the deal could be a repeat of the success Abbott Laboratories experienced with its acquisition of Knoll Pharmaceuticals in 2001, a deal that brought in Humira, a drug that is now among the world's best-sellers. Like the deal with Piramal, that transaction, with Germany's BASF, was quarterbacked by Abbott's chief executive Miles White, who has earned a reputation as being one of the boldest dealmakers in the industry. On Friday the health and pharmaceutical firm said it would acquire the domestic business of India's Piramal Healthcare, a leading branded generics company, in a deal that would include $2.1 billion up front, plus $400 million annually over four years. "With this deal, the combined Healthcare Solutions and Abbott businesses will become the clear market leader in India, with a market share of approximately 7%," says Ajay Piramal, chairman of Piramal Group. The purchase furthers Abbott's increasing commitment to the emerging markets. Earlier this month the company said it would license at least 24 products in emerging markets through a new unit created to boost sales outside of the U.S. Approximately a fifth of the firm's pharmaceutical sales come from emerging markets. In its announcement at the time, Abbott said pharmaceutical sales in emerging markets are expected to grow at three times the rate of developed markets and account for 70% of the industry's growth over the next several years. It added that branded generics represent the most significant growth opportunity in emerging markets. Though the new markets include a strong presence in Asia, the countries Abbott included stretch from Brazil to Egypt and Ukraine. Abbott's interest in emerging markets isn't unique. Earlier this month peer GlaxoSmithKline also made its own forays with the 10% acquisition of South Korean firm Dong-A Pharmaceuticals. The deal was made in the hopes of giving Glaxo a larger presence in Asia and offering a counterweight to sagging performance in the West. Safe Harbor Statement: Some forward looking statements on projections, estimates, expectations & outlook are included to enable a better comprehension of the Company prospects. Actual results may, however, differ materially from those stated on account of factors such as changes in government regulations, tax regimes, economic developments within India and the countries within which the Company conducts its business, exchange rate and interest rate movements, impact of competing products and their pricing, product demand and supply constraints.   Nothing in this article is, or should be construed as, investment advice.

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