Abbott buys India generic drugmaker for $2.2B

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Abbott has completed its acquisition of Piramal's Healthcare Solutions business, seeking to fortify its market share in India pharmaceuticals and in the emerging markets.

Abbott, through a wholly-owned subsidiary, purchased the assets of Piramal's Healthcare Solutions unit for a $2.2 billion up-front payment, with additional payments of $400 million annually for the next four years, beginning in 2011. The company said the transaction will not impact its ongoing earnings per share guidance in 2010.

India's pharmaceutical market growth is being driven largely by branded generics, according to the Abbott Park, Ill.-based Abbott. The market will generate nearly $8 billion in pharmaceutical sales this year, a number that is expected to more than double by 2015.

Piramal's Healthcare Solutions business has a portfolio of branded generics, including brands in respiratory, cardiovascular, pain and neuroscience. The Healthcare Solutions business will operate as a separate unit, reporting into Abbott's newly-created Established Products Division, which was formed to focus on branded generics, especially in emerging markets. The business will continue to be led by its current India-based management team, according to Abbott.

Abbott predicted its pharmaceutical sales in India will exceed $2.5 billion by 2020.