Glenmark Life Sciences to cater to the global need for affordable APIs

PT Jyothi Datta Mumbai | Updated on July 22, 2021

Price band fixed at ₹695 to ₹720 per equity share; IPO opens from Tuesday


Glenmark Life Sciences expects to tap into the opportunity arising from global need for quality and affordable APIs (active pharmaceutical ingredients) in the post-pandemic world.

Everyone in the world is under pressure to bring health budgets under control and this fuels the need for affordable options in the post-pandemic scenario, Yasir Rawjee, GLS Managing Director and Chief Executive, told BusinessLine, adding that the demand had been “extremely robust”.

Citing the example of Brazil, where a court suspended extensions on drug patents, he said, it was not an act “out of the blue”. Such decisions are led by the fact that countries are looking for better options and API is part of the overall cost, he said.

Focus on APIs

GLS operates in the high-value, non-commoditised API segment and is slated to be listed next week. Glenn Saldanha, Chairman and Managing Director of Glenmark Pharmaceuticals, said, the company was going in for a listing after two decades. The API business had been built over two decades, he said. In 2019, the company had spun it off into a separate entity to get better focus on APIs and contract drug development and manufacturing, besides scaling it up to become a major player globally.

The company fixed its price band at ₹695 to ₹720 per share and bids can be made for a minimum of 20 equity shares in multiples of 20 share thereafter, the company said.

Outlining the global opportunity, Rawjee said, the total pharmaceutical market is a $ 1.1-trillion market worldwide and APIs are pegged at about $190 billion (2021), projected to reach $260 billion by 2026. In India, the bulk drug segment is growing at about nine percent, he said.

With revenues at ₹1,885 crore, he said, the therapeutic areas of focus included cardiovascular, central nervous system, pain and diabetes segments. Segments of interest for the future include oncology and iron complexes – where they are working with customer to commercialise the product, he said, besides peptides.

In fact, GLS has four key projects in its basket where it is working with clients, he added. The company has four manufacturing facilities and is setting up a fifth in Solapur (Maharasthra) and expects it to be ready in about 18 months, he said. The funds from the IPO will also be used to pay off its existing ₹800 crore-odd debt to the parent, he added.

The offer

The company’s IPO consists of equity shares of face value of ₹2 each of GLS comprising a fresh issue of equity shares aggregating to ₹10,60 crore and an offer for sale of up to 6,300,000 equity shares by the promoter Glenmark Pharmaceuticals Limited.

Up to 50 per cent of the total offer is reserved for qualified institutional buyers and 15 per cent for non-institutional investors. The remaining 35 per cent stake is allocated to retail investors, the company said.

Published on July 21, 2021

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