Ranbaxy may hand over Latin American marketing to Daiichi Sankyo

Ranbaxy Laboratories may hand over its Latin American marketing operations to parent Daiichi Sankyo, a move that may be followed up with exits from certain other countries in the region, according to analysts.

"Daiichi may be better placed to lead the business from the front for both the companies (in these countries)," Ranbaxy chief executive officer Arun Sawhney told analysts in a conference call yesterday. "The evaluation of the plan is under way." Ranbaxy operates in 11 countries in the region, including Brazil and Mexico.

An ET report citing an unnamed person familiar with the company's operations said the Gurgaon-based company had been looking to exit Brazil, its largest market in Latin America. It added that Daiichi Sankyo could also buy out Ranbaxy's operations in that country.

According to some analysts, the company could close down marketing operations in the countries to cut costs.

Ranbaxy's share price was down at Rs428.45, dipping 2.61 per cent on Bombay Stock Exchange yesterday at close of day.

After acquiring Ranbaxy, Daiichi Sankyo has undertaken restructuring of its global operations in a bid to cross-leverage strengths with the Indian company. Daiichi is engaged in the production of original patented drugs, while Ranbaxy is focused on low-cost versions of off-patent drugs.