Dr. Reddy’s Laboratories, a major drug company, is set to buy the global nicotine replacement therapy (NRT) portfolio of British pharma company Haleon, except for the US market, for £500 million.
Dr. Reddy’s subsidiary, Dr. Reddy’s Laboratories SA, will acquire the share capital of Haleon’s Northstar Switzerland SARL for a total of £500 million. This includes an upfront cash payment of £458 million and performance-based payments of up to £42 million, which are due in 2025 and 2026.
The deal is expected to be completed in early Q4 of 2024, with the transition happening gradually.
Dr. Reddy’s CEO, Erez Israeli, stated, “This acquisition of consumer healthcare products, especially the Nicotinell brand, is a logical extension of our consumer healthcare efforts. We aim to expand our OTC presence globally and invest in our capabilities.”
The Hyderabad-based company will acquire the Nicotinell brand, which is present in over 30 countries across Europe, Asia (including Japan), and Latin America, along with other brands like Nicabate, Habitrol, and Thrive outside the US.
Israeli added, “The portfolio is attractive for its customer loyalty, global reach, and key customer access. We aim to grow this portfolio and increase global consumer access to these brands.”
Nicotinell is the second largest NRT brand globally (excluding the US), holding top positions in many markets. The acquisition includes all formats of Nicotinell, such as lozenges, patches, and gum, along with pipeline products. Last year, Nicotinell generated £217 million in revenue.
NRT products help people quit smoking by providing some of the nicotine found in cigarettes. Dr. Reddy’s noted that tobacco use causes eight million deaths annually worldwide.
According to the World Health Organization, out of 1.3 billion tobacco users globally, 60% want to quit, but only 30% have access to tools to help them quit successfully.
In recent years, Dr. Reddy’s has expanded its consumer healthcare presence worldwide, including a recent joint venture with Nestlé India.
Disclaimer: The views and investment tips expressed by investment experts on Sharepriceindia.com are their own and not those of the website or its management. Sharepriceindia.com advises users to check with certified experts before taking any investment decisions.
