Amgen looks to Brazil for some growth

Amgen targets Brazil through $215 million takeover of Bergamo and reacquisition of products

Jeffrey Bouley
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THOUSAND OAKS, Calif.—In a pair of moves announcedApril 8, biotech giant Amgen is strengthening its position in Brazil, firstwith the acquisition of Bergamo, a privately-held Brazilian pharmaceuticalcompany, for about $215 million and second with the reacquisition of rights inBrazil to its products that were previously granted to Mantecorp, a company subsequentlyacquired by Hypermarcas.
Together, these transactions will, Amgen reports,provide it with "a significant presence in Brazil and immediate, direct accessto one of the fastest growing pharmaceutical markets in the world."
Bergamo is a leading supplier of oncology medicinesto the hospital sector in Brazil and has manufacturing facilities in Sao Paulo,bringing with it gross revenues of $80 million in 2010. In fact, the company hasbeen growing at an annual rate of 19 percent since 2007. Brazil in general isamong the top 10 pharmaceutical markets in the world and in recent years hasbeen growing at a rate of about 12 percent per year—it is expected to be theworld's fifth largest pharmaceutical market by 2015.
As for the reacquisition deal, Amgen has enteredinto an agreement in principle with Hypermarcas to reacquire the rights inBrazil to several of Amgen's innovative medicines. Two of them, Vectibix(panitumumab) and Mimpara (cinacalcet) are already approved in Brazil and the third,romiplostim (a blood disorder medicine registered as Nplate in the UnitedStates), is currently under review by ANVISA, the regulatory authority inBrazil. 
"Amgen's strategic goal is to make our innovativemedicines available to patients in major markets around the world," says KevinSharer, Amgen's chairman and CEO. "Acquiring Bergamo, a profitable company withan established local infrastructure, and regaining the rights to our productsin Brazil, provides us an attractive entry into the Brazilian market."
The focus on Brazil is part of a widerinternational expansion strategy for Amgen, the company notes.
"We expect Amgen to continue to be acquisitive andsee similar transactions," Deutsche Bank analyst Robyn Karnauskas wrote in aresearch note. 

Jeffrey Bouley

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