News: Ranbaxy, on buying spree, eyes U.S.

(RTR 25/07/2006) New York - Ranbaxy Laboratories Ltd., which has been on a European buying spree, is also eyeing U.S. acquisitions as it seeks to become one of the five largest generic manufacturers within six years.

Ranbaxy Chief Executive Malvinder Singh described the United States as his company's most important market in an interview on Monday and said he was looking for deals that would broaden the company's product line and add new technological capabilities.

"We're interested. We want to do it. We keep evaluating opportunities," Singh told Reuters. "If there is a right fit and a good fit we will definitely look at it and go for it."

Singh, the 33-year-old grandson of Ranbaxy's founder, became chief executive officer in January. Since then, Ranbaxy has acquired generic companies in Italy, Spain, Belgium and Romania. At $324 million, its purchase of Romania's Terapia was the largest of the four.

Singh said the company overall is the world's eighth largest in generic drug sales and now has a presence in 21 of the 25 EU countries.

The United States, however, remains the biggest part of Ranbaxy's business, comprising about 30 percent of revenues.

Singh said he would like to increase the proportion of his company's sales that come from the United States to as much as 50 percent.

"We certainly see the American market to continue to remain the most important market for us," Singh said. "We are committed to increasing and strengthening our presence in this market."

Singh's eagerness comes as some analysts warn of price competition threatening the profitability of the U.S. generics market.

He acknowledged that prices fell sharply last year, and came down again this year, although less so than in 2005. The market is being affected by more companies selling more products, as well as greater aggressiveness by branded pharmaceutical companies in the generics market, he said.

Still, he said, the company can continue to be profitable even with prices low, having girded for such competition through its experience in its home market of India.

"When we go to international markets, even if it's the U.S. market, we see far less competition here than we do in India," Singh said. "You haven't heard of 100 players being in one molecule, have you?"