The government today cleared the Rs 5,168-crore deal of the US-based Mylan Inc for acquiring Bangalore-based pharma firm Agila Specialties, a subsidiary of Strides Arcolab.
The decision was taken at a meeting of the Cabinet Committee of Economic Affairs (CCEA) held here, Information and Broadcasting Minister Manish Tiwari told reporters.
The acquisition, however, is subject to certain conditions. After the completion of acquisition process, Mylan has to maintain the investment level in R&D in value terms for five years at absolute quantitative level at the time of induction of FDI, according to sources.
Further, the US-based company would also have to maintain the production level of National List of Essential Medicines (NLEM) drugs and consumerables and their supply to domestic market at the time of induction of FDI for the next five years at an absolute quantitative level.
"The benchmark for this level would be decided with reference to level of production of NLEM drugs in three years immediate preceding to year of induction of FDI," they said.
Since the investment proposal was of over Rs 1,200 crore, it came up before the Cabinet Committee on Economic Affairs for final approval after it was cleared by the Foreign Investment Promotion Board last month.
In February this year, Mylan had announced that it would acquire entire issues and outstanding share capital of Agila Specialities Pvt Ltd -- a subsidiary of pharma firm Strides Arcolab.
Agila Specialities is public listed company based in Bangalore. It is engaged in development, manufacturing, marketing and sale of generic pharma products, particularly in oncological products.
On the other hand, Mylan Inc is a fully integrated global pharmaceutical company. It has presence in India through its subsidiary Mylan Laboratories Ltd, Mylan Pharmaceuticals Pvt Ltd and Astrix Laboratories Ltd.
Mylan Laboratories Ltd has been recently engaged in acquiring various manufacturing facilities from existing pharma companies through internal accruals.
