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Sun Pharma In The News

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Dusa, a different kind of acquisition: Sun chief

"It is a different kind of ac­quisition from those we have done in the past," says Sun Pharma Managing Director, Di-lip Shanghvi, on the proposal to acquire speciality dermatology company DUSA.

The challenge is to create val­ue, and we are confident and excited about the potential for growth in the dermatology mar­ket, he told analysts, a day after Sun announced its agreement to buy DUSA for $230 million.
A company official said Sun's previous buys, including Cara-co in the US and Israeli compa­ny Taro, were in the generic drugs space. In contrast, DUSA is an innovative drug device company, the official said.
Centrum Broking's Senior Vice-President Ranjit Kapadia agrees the acquisition is different because it is more IP-relat­ed and there are more products in the research pipeline.
DUSA clocked revenues of $45 million in 2011, and the deal still has to go through the open offer process to shareholders, be­sides meeting other conditions, before it is completed.
Sun's last overseas acquisi­tion, Taro, saw the Mumbai-based company locked in a long, protracted battle across geog­raphies. There will be no syn­ergy (DUSA's products) with Taro, Shanghvi clarified.
And while Sun made Caraco a wholly-owned subsidiary in 2011, it is at present undertak­ing efforts to do the same with Taro. But this process has not been without its hurdles, as minority shareholders are seeking higher prices for their shares.
DUSA's key product is Lcvulan, a light-sensitive combination therapy to treat a pre-cancerous skin condition, affecting the face and extremities. A frequently diagnosed skin condi­tion in the US, Shanghvi said, there arc about S million such treatments per year and the DUSA product has five per cent of the market. Along with drugs and other therapies by derma­tologists, the segment is estimated at more than $1 billion, he added.
Meanwhile, the company also revised its guidance, pegging revenue growth at 30-32 per cent by March 2013. The confidence comes from performance seen in the first six months, a company official said. Sun's earlier revenue guidance was about 20 per cent.