Merck and Sun Pharmaceutical form joint venture around branded generic drugs in emerging markets

WHITEHOUSE STATION, N.J. & MUMBAI, India—Looking for a major entrée into emerging markets with branded generics, Merck & Co. Inc. is entering into a joint venture with Sun Pharmaceutical Industries Ltd., one of India's leading multinational pharmaceutical companies. The companies say they will focus on "'innovative branded generics" that bring together combinations of medicines using platform delivery technologies designed to enhance convenience for patients in emerging markets.

The partnership combines the clinical development and registration expertise and broad, geographic commercial footprint of Merck—known as MSD outside the United States and Canada—with Sun Pharma's "proven track record of leadership and expertise in rapid, innovative product development" using Sun Pharma Advanced Research Co. (SPARC) proprietary platform technologies along with Sun Pharma's "world-class" manufacturing network. The joint venture will be structured through Merck and Sun Pharma's respective subsidiaries. Financial details of the joint venture were not disclosed.

"Merck's emerging markets strategy is driven by our overarching focus on applying innovation across our business from introducing novel compounds to broadening our focus on innovative branded generics," says Kevin Ali, president of emerging markets for Merck/MSD. "By combining forces with Sun Pharma, we are complementing our innovative product portfolio with a solid foundation for addressing the diverse needs of patients, physicians and governments across the emerging markets. We are making good progress executing on our emerging markets growth strategy by establishing novel partnerships and strategic alliances. This joint venture helps position us for leadership in the fastest growing geographies."

Merck and Sun Pharma cites estimates that during the coming decade, emerging markets are expected to drive 90 percent of the world's pharmaceutical growth, and 75 percent of that growth is expected to be via the branded generic industry.

As Merck and Sun Pharma note, "In these markets, the growing burden of chronic disease, such as cardiovascular disease, diabetes and hepatitis, along with an increasing population and economic prosperity, is leading to an increased demand for branded generics." Sun Pharma has described the joint venture as the "beginning of a long symbiotic relationship."

"This joint venture reinforces our strategy of partnering to launch products using our highly innovative delivery technologies around the world," says Dilip S. Shanghvi, chairman and managing director of Sun Pharma, which is known in particular for its psychiatry, gynecology, neurology, cardiology and ophthalmology expertise. "It will leverage Merck's market presence and regulatory competence across emerging markets. This will help us optimize the potential for JV products."