TOWA Pharmaceutical to Acquire Pensa Investments from ESTEVE to Accelerate Global Generic Drug Expansion

VCBeat (WeChat ID: vcbeat) learned from foreign media that on December 23, 2019, Japan’s Towa Pharmaceutical Co., Ltd. announced its intention to acquire Pensa Investments, the generics division of the Spanish healthcare company Esteve. The transaction is valued at approximately $350 million, through which Towa Pharmaceutical will obtain 100% equity interest in Pensa Investments, with completion planned for the end of January next year.

Following the acquisition, Towa Pharmaceutical will leverage Esteve’s facility in Spain, which specializes in the manufacture of granule formulations, as well as its subsidiaries in Europe and the United States, to provide high-quality, value-added generic drugs to patients in Japan and overseas. Correspondingly, Towa Pharmaceutical intends to expand the overseas sales market for its generic drugs through this channel.

Founded in 1929 and headquartered in Barcelona, Spain, ESTEVE is an international company dedicated to the pharmaceutical industry and one of the largest pharmaceutical groups in Spain. Since its inception, ESTEVE has adhered to a manufacturing concept centered on active pharmaceutical ingredients (APIs), encompassing both new chemical entities (NCEs) and generic drugs. The company continuously refines its capabilities by integrating cutting-edge technologies in chemistry and pharmaceutics through the use of state-of-the-art technology and equipment. Its product portfolio is extensive, covering solid oral dosage forms and injectables. In addition to its generics business, ESTEVE establishes alliances with strategic pharmaceutical manufacturers and partners, focusing on long-term collaborations. Pensa Investments, the generics division of ESTEVE, is a legal entity that provides affiliated pharmaceutical production facilities (including drug development) and operates commercial subsidiaries for generic products in Europe and the United States.

According to Bloomberg statistics, the global generic drug market reached $220 billion in 2016. From 2006 to 2016, both the prescription volume and prescription value of generic drugs showed a significant upward trend across major global pharmaceutical markets. Between 2007 and 2017, the growth rate of the U.S. generic drug market far exceeded that of branded (patent-protected) drugs. The compound annual growth rate (CAGR) for the overall U.S. pharmaceutical market was 8.2%, with generics growing at 15.6% and branded drugs at 5.5%.

Itsuo Yoshida, President of Towa Pharmaceutical, stated, “I am pleased that we can now leverage Pensa’s sales networks in Europe and the United States, its manufacturing facilities in Europe, and its expertise in EMA/FDA regulations and commercial practices across various countries, laying the foundation for our comprehensive global expansion. Our goal is to respect and integrate each other’s human resources, culture, and technology to establish a robust global structure. Working as a unified team, we will deliver Towa Pharmaceutical’s value-added products to patients worldwide.”

Towa Pharmaceutical was established in June 1951 and is headquartered in Osaka, Japan. It is a company specializing in the production of generic drugs. Since its inception, Towa Pharmaceutical has been dedicated to the research and development, manufacturing, and marketing of generic medicines. The company employs over 3,000 people and generates annual sales of nearly RMB 7 billion, with 73% derived from overseas operations.

(Compiled by Yang Xiaohui)