Canada’s Valeant backs out from buying Serbia’s Galenika Pharmaceuticals

Valeant Pharmaceuticals International, Canada's biggest drug maker and one of the most aggressive acquirers, has backed out from tabling a bid for  Serbia's Galenika Pharmaceuticals after it acquired contact lenses maker Bausch & Lomb for $8.7 billion.

The move comes a few weeks after Valeant also gave up plans of acquiring US generic drug giant Actavis Inc for $13 billion due to differences in valuation (See:  Valeant Pharma's $13-bn Actavis deal put on hold).

In a letter sent to the Serbian ministry of finance, Montreal-based Valeant said that it is abandoning plans of acquiring state-run Galenika because of the hostile attitude of the trade union and employees towards a potential privatisation.

In December 2012, the Serbian government invited bids for Galenika, in which Valeant was the only bidder.

But the proposed sale was opposed by employees of Galenika, who had agitated in Belgrade against the privatisation of the company.

The company's union also opposed the deal and said that the sale of the only domestic drug company would deprive consumers of cheap drugs.

Founded in 1945, Zemun-based Galenika, which has 2,725 employees, is a major drug-maker in the Balkans and the only Serbian state-owned pharmaceutical company.

It makes generic drugs, pharmaceutical raw materials, dietetic supplements, medical devices, and dental products. It also does contract manufacturing and offers laboratory services.

Most of its products are exported to Africa, Asia, Russia and southeastern Europe.

The company has posted loss of €105.2 million in 2011.

Valeant has a product portfolio of about 490 products, and has two drugs in the top 200 drugs by sales in the US. Its main markets are in the US, Canada, Mexico, Brazil, Europe and Australia.

The company has made over 60 acquisitions since 2008.  It has a market cap of $22.4 billion and annual revenues of $3.5 billion.