Hyderabad-based Dr. Reddy's Laboratories would buy eight new drugs from Israel's Teva Pharmaceuticals for $350 million in a move aimed at strengthening its presence in the United States markets.
The new drugs to be acquired are generic products, one of which has already been approved by the U.S. Food and Drug Administration (USFDA) and the rest of the applications are awaiting regulatory nod.
"The portfolio being acquired is a mix of filed Abbreviated New Drug Applications (ANDAs) pending approval and an approved ANDA and comprised of complex generic products across diverse dosage form," Dr. Reddy's said in a Bombay Stock Exchange (BSE) filing on Saturday.
An ANDA is a filing before the regulator to get approval for selling generic medicines.
The deal, however, is subject to the pact between Teva Pharma and U.S.-based Allergen PLC after which the eight drugs would be divested to Dr. Reddy's portfolio. Teva is likely to acquire Allergan's generic drug business for $4.2 billion, according to the Wall Street Journal.
The deal is also awaiting the approval of the U.S. Federal Trade Commission.
"The acquisition of these ANDAs is also contingent on the closing of the Teva Pharmaceutical/Allergan Plc generics transaction and approval by the US Federal Trade Commission," Dr. Reddy's said.
The combined sales of the branded versions of these drugs in the U.S. for a period of one year till April, 2016, was $3.5 billion, according to IMS Health, a data firm.
"The transaction will add strength to our product portfolio, help us be more relevant in our U.S. market and create new opportunities for growth," G.V. Prasad, chief executive of Dr. Reddy's said in a statement.
Dr. Reddy's has, however, not disclosed the details of the drugs and said that these are "complex generic products."
Shares of Dr. Reddy's Lab jumped nearly 1 percent on the BSE at Rs 3085 on Monday at 1.32 p.m from its previous close.
The U.S. is the world's largest generic medicines market. Indian companies that manufacture cheaper, generic versions of branded drugs account for16 percent of the $800 billion U.S. pharma market.