Watson throws $30M in the pot as it and Moksha8 form marketing partnership for Brazil and Mexico

Watson investment part of $61 million Moksha8 financing round

Jeffrey Bouley
MORRISTOWN, N.J.—Watson Pharmaceuticals Inc. announced recently that it had entered into an agreement with Sao Paulo, Brazil-based Moksha8 that will expand Watson's commercial presence in Latin America's two largest markets: Brazil and Mexico. As part of the deal, Watson will invest $30 million in Moksha8 as part of the latter company's approximately $61 million financing that includes investments from existing investors TPG Biotechnology and Montreux Equity Partners.

As a result of this agreement, Watson immediately gains a significant minority ownership position in Moksha8. Watson has also committed to invest an additional $20 million, further increasing its equity position, contingent upon successful execution by Moksha8 of additional third-party product acquisitions over the next year. In conjunction with its investment in Moksha8, Watson has designated a representative to serve as a member of the Moksha8 board of directors.

"This unique partnership further demonstrates our commitment to expand our global footprint through creative business solutions that maximize the commercial opportunities for our current portfolio of brands and branded generics, establish the foundation for future growth in high value and expanding markets, and creates immediate value for both partners," says Paul Bisaro, Watson's President and CEO.

"The management team of Moksha8, led by Simba Gill, has a proven track record of effectively commercializing products within the brand and branded generic markets of Mexico and Brazil," Bisaro adds. "This agreement, which provides Watson with an initial equity position, enables us to help fund Moksha8's expansion and to share in their continued success. The partnership complements Watson's existing commercial operations in Brazil, while establishing an expanded longer-term strategy to grow our presence in Brazil, establish our presence in Mexico and develop a pan-Latin American growth strategy."

"The addition of Watson to our current business expands our existing portfolio and pipeline of high quality products for the Latin America market," says Simba Gill, CEO of Moksha8. "Further, this partnership marks Moksha8's entry into the rapidly growing branded generics market and immediately strengthens our position as a leader in the treatment of CNS disorders including depression, anxiety and schizophrenia."

Watson will manufacture and supply select products to Moksha8, which will have exclusive rights to market, sell and distribute these products in Brazil and Mexico. Moksha8 and Watson have initially identified approximately one dozen product candidates, with the opportunity to expand the commercialization and marketing agreement to include additional products in the future.

Watson will continue to own all marketing authorizations, and Moksha8 will be responsible for sales, marketing and commercialization expenses.

Moksha8 currently markets 21 branded products for third parties in Latin America, utilizing a field force of approximately 180 sales representatives in the areas of CNS, infectious disease and pain. Combined, Brazil and Mexico make up 75 percent of the $40 billion pharmaceutical market in Latin America.

Watson currently manufactures and markets select generic products in the Brazilian marketplace through a Brazilian subsidiary. This venture will have no impact on that subsidiary's current operations, including current management, manufacturing and supply chain; Moksha8 will complement Watson's Brazilian sales and marketing capabilities.
 

Jeffrey Bouley

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