With German and Medley for sale, generic loses charm for "Big Pharmacies"

In April 2009, the French laboratory Sanofi Aventis paid 1.5 billion R$ by brazilian Medley, the leader in sales of generic drugs in the country at that time. A year later, the American Pfizer bought 40% of the German by R$, with the option of 400,000,000 take control between 2014 and 2016.
The two acquisitions marked the entry of large international laboratories, known as Big Pharmacies, in the thriving market for Brazilian generic drugs grew at rates.
Less than a decade later, that looks like charm. The German went on sale by Pfizer and Melo, founder of the family company. BTG investments banks and Goldman Sachs were hired to sell it. Sought, Pfizer says.
Sanofi Aventis hasn''t hit the hammer will stand the Medley for sale. But sources heard by the blog BEHIND the SCENES of the COMPANIES believe that this must be the path to be followed by the French group, it is depriving of their generics global business.
Sought the Sanofi Aventis denies that the Medley is for sale. "In relation to speculation market, Sanofi won''t confirm that the Medley is for sale," according to the company, by means of a note. "Medley, one of the leaders in the production and sale of generic medicines and the like, occupies a fundamental role in the business plans of Sanofi in Brazil."
The generics market grew up 11.75% in 2015, a slowdown compared to previous years. The recipe was R$ 5.9 billion, representing 12.9% of total industry revenues, according to data from PróGenericos, an organization that represents businesses in the area. By units, the slice of the unbranded drugs is 29%.
Is a market for any company. But the margins of generic drugs are very low, the discounts on the retail end come to reach 90% and the consumer preference in pharmacies is fierce.
"These groups want to channel their resources to innovative medicines, such as Biologics, which are the sector''s future, and bring higher margins," says an expert from the pharmaceutical sector.
Medley, who led the Brazilian generics industry, lost the first place to the EMS, businessman Carlos Sanchez. In recent years, the pharmaceutical Sanofi Aventis faced major turbulence, changing to three Presidents. The company, which was the solution to the Sanofi Aventis, ended up turning into a problem.
The strategy, then, was to abandon the fight for market share. With that, she reduced the discounts to retailers and focused on profitability. "I can assure you that the operation today is super-rentável", says a former Executive of the company.
In this restructuring, the company lost its independence and became a business unit of Sanofi Aventis, commanded by Carlos Aguiar, his former Commercial Director. This move displeased a lot of people internally. "There''s an insecurity there," says a former employee.
According to data from IMS Health consulting, the Medley made R$ 993,000,000 generic 2015 with, behind only the EMS Pharma, with revenues of R$ $ 1.158 million. The second runner-up was the Neo group Hypermarcas, Chemistry with R$ 574,000,000. The numbers already consider the discounts given by the industry, distributors and retailers.
The German, in turn, has a smaller than the Medley. Last year, won the 8th 305,000,000 R$ ranking of generics. Unlike the German Medley worked with big discounts on the retail end to try to win market, pushing further the already tight margins.
Who are the potential buyers? The industry leader the EMS would be out of contention. Today, she has four laboratories among the 10 largest generic vendors of Brazil. In addition to the EMS Pharma, businessman Carlos Sanchez owns Germed, Legrand and new chemistry.
Hypermarcas, second it was found the blog BEHIND the SCENES, COMPANIES would have interest in Medley. With the Medley, she would surpass the EMS, becoming the leader in generics. An offer, in this moment, it would be highly unlikely.
International giants of generics, such as Dr. Reddy''s Indian ´ and straight, so with the Israeli Teva, could take advantage of this opportunity, industry sources believe.
With the departure of Big Pharmacies, a new consolidation phase seems to be generic way.