South Korea’s Celltrion Inc. will divest of a portfolio of Takeda Pharmaceutical's prescription medicines sold in Asia to CBC Group, a Singapore-based investment firm, according to sources familiar with the matter on Monday.
It is also in the final stages of talks to sell the exclusive domestic sales rights for some over-the-counter (OTC) drugs of the Japanese company to a large Korean pharmaceutical firm, the sources said.
Back in 2020, Celltrion, a leading biosimilar maker, acquired 18 pharmaceutical products and OTC products marketed primarily in Asia Pacific from Takeda Pharmaceutical for $278 million.
Under the deal, Celltrion has secured the patents, trademarks and exclusive sales rights in Asia of the drugs, which Takeda agreed to continue to manufacture and supply to Celltrion.
Now it is set to sell those rights for the portfolio of Takeda's prescription medicines it has acquired to CBC.
The medicines up for grabs are in the cardiovascular, diabetes and general medicine therapeutic categories and are marketed in Australia, Hong Kong, Macau, Malaysia, Philippines, Singapore, South Korea, Taiwan and Thailand.
The deal excludes the sales rights in South Korea of Nesina, an anti-diabetic drug and Edarbi, a hypertension treatment. They are the main growth drivers of the portfolio of prescription drugs.
To facilitate the sale, Seo Jung-jin, founder and chairman of Celltrion, separated the transaction into prescription medicines and non-prescription drugs.
The portfolio of Takeda's prescription medicines has attracted three bidders, including CBC Group, according to the sources.
In 2022, CBC funded China-based Hasten Biopharmaceutic Co.'s acquisition of five prescription pharmaceutical products sold in China from Takeda.
OTC DRUGS
Celltrion is in talks to sell the domestic sales rights of some Takeda-produced OTC drugs to a large Korean pharmaceutical company for several tens of million dollars, according to the sources.
The portfolio of OTC drugs up for sale includes Whituben, a medicine for a cold and Albothyl, a mouth ulcer treatment.
“We are in the final stages of negotiations, so we will be able to sign a definitive agreement sooner rather than later,” a Celltrion official told The Korea Economic Daily.
Whituben is a popular non-prescription cold medicine VALUE ESTIMATIONS
One of the sources said the two deals for Celltrion, if completed, would generate several tens of million dollars in capital gains.
That suggests the divestment might fetch around $350 million or below in total, applying the exchange rate in June 2020, when Celltrion acquired the assets.
Based on the current dollar/won rate, however, the sale price could be lowered to about $300 million in aggregate.
Celltrion is expected to use the proceeds from the pending sale for clinical trials of new drug candidates, or put them aside for M&As.
CBC leads a consortium to buy a controlling stake in Hugel, South Korea’s largest botox maker Celltrion had built a relationship with Singapore-based CBC Group since 2020, when they discussed building a factory in China. The talks came to a halt after the COVID-19 outbreak.
Founded in 2014, CBC is Asia's largest healthcare-focused investment firm with $7 billion in assets under management. Its South Korean portfolio includes Hugel Inc., the country's largest botox maker.
The consortium includes Abu Dhabi-based Mubadala Investment Company; GS Holdings Corp., the holding company of South Korea’s energy-to-retail conglomerate GS Group; and Seoul-based IMM Investment Corp.
