WOCKHARDT TO SELL MARKETING RIGHTS OF DIABETES DRUGS
WOCKHARDT, a troubled drugmaker with huge debts, is in talks with GlaxoSmithKline, Pfizer and Novartis to sign a deal that would give marketing and research rights of its diabetes drugs under development to one of the global companies, two persons familiar with the development said.
"The interested parties have had detailed discussions but Mr (Habil) Khorakiwala still needs to decide on what his expectations are as far as valuing this business is concerned,â€ the banker who did not want to be identified, said.
Habil Khorakiwala of Wockhardt is selling some assets after the company failed to service huge debt piled up in its eagerness to acquire companies overseas. It also lost hundreds of crores of rupees on derivatives transactions. The Mumbai-based company in the last few months agreed to sell a chain of hospitals to Fortis Healthcare and popular food brands such as Protinex and Farex to Abbot Laboratories. A Wockhardt spokesperson declined to comment on the topic. A Pfizer spokesperson said in a telephonic conversation that as part of company policy, it does not comment on market speculation. Novartis and GSK also responded on similar lines.
Executive chairman Mr Khorakiwala had in March said he was eager to enter into collaboration with a foreign partner for its diabetes drugs portfolio. Statistics from IMS Health, a US-based market resaerch firm, shows that global sales of diabetes drugs totaled $27.3 billion in 2008.
Diabetes affects 246 million adults worldwide, according to data available with the American Diabetes Association.
The deal if concluded could see Wockhardt get upfront payments, royalty fees on sales and mile stone payments, depending on the productsâ€™ success during various stages of research and the final retailing to the products.
Wockhardt has invested as much as $200 million in building research & development for drug discovery which include insulins and insulin analogs. Some are already sold and some are under development, according to a person close to the company.
Wockhardtâ€™s sales of Insulins and insulin analogs are less than Rs 50 crore annually.
Search Lawyer by Area of Practice