Sun Pharma Strengthens US Foothold with Strategic Acquisitions

Indian pharmaceutical companies such as Sun Pharma, Syngene, Senores, and Zydus are expanding their presence in the US through strategic acquisitions. This trend is seen as a hedge against future uncertainties and a response to the rising demand for biosimilars and specialty drugs. Analysts attribute this wave of acquisitions to the increased confidence of Indian firms in navigating US Food and Drug Administration (USFDA) regulations and securing first-to-file exclusivity as patents expire. Factors such as large group purchasing organizations and pharmacy benefit managers squeezing supplier margins, as well as post-COVID supply chain disruptions, are also pushing these companies toward mergers and acquisitions (M&A) to optimize costs and maintain profitability. However, acquisitions come with challenges including regulatory hurdles, premium valuations, integration issues, and potential financial strain due to high debt. Despite these challenges, analysts anticipate the acquisition trend to continue in the short to medium term with a focus on complex generics and biosimilars. The market expansion strategy reflects the IT industry’s past moves, although rising interest rates, regulatory compliance, and declining generic drug prices could impact the profitability and momentum of future deals.