Benefits of the acquisition of Betapharm by Dr. Reddy’s Laboratories Limited

In the year 2006, on Feb 15^th, DRL, Dr. Reddy’s Laboratories limited acquired Betapharm, the 4^th largest generic pharmaceutical company in Germany. The acquisition deal also included the Beta Institut for the purpose of sociomedical research.

The major benefits of this acquisition to DRL are as follows:

1. DRL will get immediate access to the generic market of Germany.
2. 66% of generic market in Europe is held by Germany.
3. DRL will gain strategic presence in EU.
4. Will help DRL to realize its aim of becoming $1 billion mid seized company by 2008.
5. There was not much liability linked to this acquisition, as the Betapharm was growing constantly and had a well planned future.
6. DRL can also increase its product portfolio.
7. The Betapharm didn’t have any manufacturing units, so it would allow for seamless integration with DRL.
8. Betapharm had a strong marketing infrastructure (distribution channels are well established with doctors, pharmacists, etc.).
9. DRL can reduce its dependence on US market.
10. Betapharm can be used as a vehicle to launch DRL’s products in Germany.

The major benefits of this acquisition to Betapharm are as follows:

1. Will be able to increase its product portfolio and grow faster in Germany.
2. Can use DRL’s marketing infrastructure and global product development to expand its presence.
3. DRL provided competitive manufacturing costs, which will help it develop its position in Germany.
4. DRL has well known Corporate Social Responsibility initiatives, so Betapharm can continue with its corporate philosophies.