AsianScientist (May 5, 2015) – The board of directors of Daiichi Sankyo Company, Limited has approved a resolution to sell entire or part of its holding of Sun Pharmaceutical Industries Ltd. shares, signalling a retreat from the Indian market.
Daiichi Sankyo, the second largest pharmaceutical company in Japan, bought India’s Ranbaxy Laboratories in 2008, hoping to tap into the growing demand for generic drugs. In 2014, Ranbaxy was acquired by Sun Pharma in a transaction estimated to be worth US$4 billion, forming India’s largest pharmaceutical company and leaving Daiichi Sankyo with an 8.9 percent stake in the new entity.
However, the firm was subsequently slapped with a warning from the US Food and Drug Administration (FDA) on May 7, 2014, over concerns of data integrity issues. Ranbaxy had also previously been fined for manufacturing and distributing ‘adulterated’ drugs in 2013.
From the perspective of the improvement of corporate value, Daiichi Sankyo has performed a review of the Sun Pharma shares and reached a conclusion to sell the shares entirely or partially. After the sale, Daiichi Sankyo will not be a major shareholder of Sun Pharma. However, the existing business partnership with Sun Pharma will remain unchanged.
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Source: Daiichi Sankyo.
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