Ranbaxy forms South African JV to sell AIDS drug

06 February 2006

The JV will be known as Sonke Pharmaceuticals and the drugs will be marketed under the brand 'Sonke'. The company will target government tenders, retail drug stores, HIV / AIDS disease management companies, non-governmental organisations etc for selling the drug.

Sonke has applied for regulatory approvals in South Africa, Botswana and Namibia and approvals are expected soon. The company has already received a voluntary license which would help it to start operations soon.

Many African countries are struggling to cope up with the spread of HIV / AIDS and South Africa is one of the worst affected countries. According to latest reports, the country has more than 5 million AIDS patients, more than 10 per cent of the total population. Most of the affected are poor who cannot afford expensive treatments.

Generic anti-retroviral drugs marketed by Indian companies like Ranbaxy and Cipla are considerably cheaper than proprietary medicines. These drugs are preferred by aid organisations and governments in less developed countries because of their affordability.

Ranbaxy has been struggling to maintain margins for the past many quarters because of a steep fall in prices of generic drugs in the US. The company has set an ambitious revenue target of $2 billion after the next two years and $5 billion by the year 2012. Ranbaxy is also considering overseas acquisitions to meet its revenue targets.

Ranbaxy is trading at Rs411 (up 4.99 per cent) at 03.15 PM on the NSE today.