Sun Pharma to buy GSK’s opiates business in Australia

UK pharma major GlaxoSmithKline (LSE: GSK) and India’s largest drugmaker by sales, Sun Pharmaceutical Industries (BSE: 524715), today announced that their respective wholly-owned subsidiaries have reached an agreement related to GSK’s opiates business in Australia.

The current GSK Opiates business including related manufacturing sites in Latrobe (Tasmania) and Port Fairy (Victoria) and its portfolio of opiates products along with inventory, will transfer to a subsidiary of Sun Pharma. GSK supplies around a quarter of the world’s medicinal opiates requirement from poppies grown in Tasmania. The Australian opiates business generated revenues of around A$89 million (about $69 million) in 2013.

Financial terms of the accord are confidential. The transaction closure is subject to customary closing conditions and requisite regulatory and other approvals, and is expected to close by August 2015.

The product portfolio consists of poppy-derived opiate raw materials that are primarily used in the manufacture of analgesics for the treatment of moderate to severe pain. All employees from both sites will also be offered employment by Sun with the opiates business.