Ranbaxy not to bid for Heumann

Ranbaxy Laboratories is not in the race to acquire Heumann, a German company, a top company source said.

"There have been some tentative enquiries from the other side, but we are not interested," the source said. Heumann, an arm of Pharmacia, makes generic drugs.

One reason why Ranbaxy is cold to the proposal is that it already has a generics business in Germany. It had acquired Basics GmbH from Bayer a few years ago, which has given it a foothold in the German generics market.

Also, Ranbaxy is closing a deal with Aventis to acquire its generics arm, RPG Aventis, in France. Another acquisition of a similar size at this time could stretch the company's resources.

Meanwhile, Dr Reddy's Laboratories too refused to comment on the news that it too was vying with others to acquire Heumann. However, the company has said in the past that it is looking at entering key European markets such as Germany either through an alliance or through an acquisition.

In 2001, Dr Reddy's Laboratories had acquired two companies in the UK "" BMS and Meridien "" hoping that it would become a launchpad to enter other European markets. But subsequently the firm said it would like to enter key markets in Europe through local firms.

Germany is a fast-growing market for generic drugs. Both Ranbaxy and Dr Reddy's have identified the generic space as their future growth area.

The companies have made significant inroads into the US, the world's largest market for pharmaceutical products. Ranbaxy has also acquired a minority stake in a Japanese generic drugs firm, hoping to cash in on the impending boom in the world's second largest pharmaceuticals market.

Governments in developed nations are trying hard to bring down the cost of medicine by promoting generic drugs, opening up immense poosibilities for Indian drugmakers such as Ranbaxy and Dr Reddy's.