By Estel Grace Masangkay
U.S. based pharmaceutical company Alvogen announced that it has acquired South Korean company Dream Pharma through its subsidiary Kunwha Pharmaceuticals. The transaction will result in the biggest generics drugmaker in South Korea.
Under the terms of the agreement, Alvogen will make cash payment of $187 million for Dream Pharma, which will be acquired through Alvogen’s Asian subsidiary. Dream Pharma currently has more than a third of total shares in the Korean obesity market and will bring more than 100 products to Alvogen’s portfolio without any market overlap in the country. The Hanwha Chemical Corp. subsidiary reported revenue of an estimated $100 million in 2013, with around 56 percent of sales coming from weight-loss drugs.
Robert Wessman, President and CEO of Alvogen, said, “I am delighted to announce this transaction. Dream is an excellent business and we are looking forward to collaborating with their high-caliber team as we work to fuel regional growth and to gain scale in the Korean market and a broader product offering.” Wessman said that the transaction will help speed Alvogen towards its goal of making it to the top five companies in the APAC market.
The acquisition is expected to be completed in the last quarter of 2014. Once acquired, Dream Pharma will be managed by Lotus Pharmaceutical. Earlier this year Alvogen and Lotus agreed to merge their Asian operations with Alvogen’s purchase of 67 percent of Lotus’ shares.
Commenting on the Dream Pharma acquisition, Lotus VP Hung Yao-le said, “Dream Pharma is not a core business for Hanwha, and we believe we can increase its profit by adjusting Dream Pharma’s structure after acquiring it.” Lotus plans to spend $180 million to acquire Alvogen Korea as well other Alvogen subsidiaries. Should Lotus succeed in buying Alvogen Korea, it would then have a 67 percent stake in Kunwha.