Japan's Sawai buys U.S. firm Upsher-Smith's generic drugs unit for $1.1 bln (updated)

SAWAI group

20/04/2017 09:44

* Deal will be Sawai's first overseas acquisition 
    * Japan's generic market is one-tenth of U.S. market in size 
 
 (Adds details of deal, market size) 
    TOKYO, April 20 (Reuters) - Japan's Sawai Pharmaceutical Co 
Ltd  4555.T  is buying the generic drug business of U.S. drug 
maker Upsher-Smith Laboratories Inc for $1.05 billion, marking 
the Osaka-based generic drugmaker's first overseas acquisition.  
    Sawai said on Thursday it is acquiring the business of the 
Minnesota-based company from the founding family to expand its 
presence in the United States, whose generic drug market it  
estimates at around 10 trillion yen ($91.87 billion), the 
world's largest. 
    Sawai's move to diversify geographically comes amid slow 
growth in Japan's overall generic drugs market. And though the 
Japanese government aims to boost usage of generic drugs, growth 
may not be commensurate as prices of generic drugs are typically 
cheaper than patented ones. 
    Japan's generic drug market currently is around a tenth of 
the U.S. market. It was worth 836.4 billion yen in 2016 and will 
grow to 1 trillion yen in 2020, according to research firm Fuji 
Keizai Co. 
    Sawai will use cash and bank loans for the acquisition. 
    The Japanese drugmaker plans to complete the deal by the end 
of June. The acquisition will not affect its earnings forecast 
for the year ended March, Sawai said. 
($1 = 108.8500 yen) 
 
 (Reporting by Chris Gallagher and Junko Fujita; Editing by 
Muralikumar Anantharaman) 
 ((chris.gallagher@thomsonreuters.com;)) 
 
Keywords: UPSHERSMITH M&A/SAWAI PHARM