Laurus Labs acquires biotech company Richcore Lifesciences
Laurus Labs has signed a definitive agreement to acquire 72.55 per cent of Richcore's shares from its private equity investors Eight Roads Ventures and VenturEast and other promoters for a value of Rs 246.7 crore.
Hyderabad-based pharmaceutical company Laurus Labs has acquired Bangalore-based biotech company Richcore Lifesciences, to diversify into manufacturing of biotech drugs. Laurus is one of India's leading manufacturers of active pharmaceutical ingredients (API) for Anti-Retroviral (ARV), Oncology, Cardiovascular, Anti-Diabetics, Anti-Asthma and Gastroenterology medicines, besides pharmaceutical contract manufacturing services.
Laurus Labs has signed a definitive agreement to acquire 72.55 per cent of Richcore's shares from its private equity investors Eight Roads Ventures and VenturEast and other promoters for a value of Rs 246.7 crore. Richcore has advanced R&D and manufacturing facilities, develops and manufactures biotech products critical for manufacturing biological drugs and offers support to develop and scale up bioprocesses by providing contract research, development, and manufacturing services (CDMO). Richcore is currently setting up its second manufacturing plant near Bengaluru and this is expected to be completed by March 31, 2021.
Laurus is focused on pharmaceutical active ingredients (API), formulations and synthesis. It is one of India's leading manufacturers of API for Anti-Retroviral (ARV), Oncology, Cardiovascular, Anti-Diabetics, Anti-Asthma and Gastroenterology medicines, besides pharmaceutical contract manufacturing services. The current promoters of Richcore led by Subramani Ramachandrappa will continue as promoters of Richcore and will continue to manage operations. Following the successful closure of the transaction, Richcore will be renamed to Laurus Bio Pvt Ltd.
The company is very excited on this acquisition, as this gives us entry into high barrier biotechnology segment. Laurus Labs will bring scale to Richcore's operations and can become a major player in the biotech contract development and manufacturing (CDMO) space," stated by Dr Satyanarayana Chava, CEO of the Laurus Labs. This will also help Laurus in becoming a leader in biocatalysts as Richcore brings significant expertise in enzyme development for pharmaceutical and other industrial applications," stated by Dr Satyanarayana Chava, CEO of the Laurus Labs.
Leveraging the synergies arising from Laurus's experience and Richcore's innovation, the company is planning to build scale as the company continue to serving the existing customers and enter new biotech segments.
Laurus Labs, on Nov. 26, closed a Rs 250-crore deal to acquire a majority stake in Richcore Lifesciences, marking its entry into the biotech space and adding to its existing three divisions - active pharmaceutical ingredients, formulations and synthesis. The start-up’s promoters and management will continue to run the business while Laurus Labs—having acquired just over 72% stake— will allow the company to scale its manufacturing. The acquisition marks Laurus Labs’ entry into the broader biologics and biotechnology segments, providing the company access to its high growth areas, globally and in India. Following the successful closure of the transaction, Richcore will be renamed as Laurus Bio Pvt.
Chava expects a significant return from the investment to come from Richcore’s contract manufacturing of recombinant proteins. The start-up’s first large-scale facility —with a 2,50,000-litre capacity—will be ready by March 2021. Shares of Laurus Labs gained as much as 4.8% in today's trade to Rs 298.8 apiece. The stock is the third best performer on the BSE 500 index on a year-to-date basis, with gains of over 300%.
