The government today gave a go-ahead to the Rs 5,168-crore deal of US-based Mylan Inc for acquiring Bangalore-based pharma firm Agila Specialties,a subsidiary of Strides Arcolab.
The approval has been given as per the extant FDI policy of the government on brownfield projects in the pharmaceutical sector wherein the foreign investor will have to abide by three main conditions. As per the extant policy,after the acquisition,the US-based firm will have to maintain the same level of investment in R&D in value terms for five years which was there at the time of induction of FDI,in absolute numbers. The company will 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.
The Cabinet Committee of Economic Affairs cleared the proposal in a meeting held today,information and broadcasting minister Manish Tiwari said. Agila Specialities is engaged in manufacturing of generic pharma products. Mylan Inc has presence in India through Mylan Laboratories Ltd,Mylan Pharmaceuticals Pvt Ltd and Astrix Laboratories Ltd.