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Australian Journal of Pharmacy : April 2005
company news company news updates Global merger creates generic giant T HE world’s fourth biggest generic pharmaceutical company, Hexal AG, has been acquired by the world’s second biggest, Novartis. Novartis plans to merge Hexal and US-based Eon Labs with Sandoz, its generics division, to form the world’s largest generic phar- maceutical company. The merged entity has annual sales of $6.5bn (2004 figures). Hexal Australia managing director, Clemens von Oswald said: ‘We are very excited about the prospects of this devel- opment because it provides a major boost to the affordability of medicines at a time when governments around the world are grappling with rising costs of healthcare. Quite simply, the combined resources of the merged entity will provide Australian customers with the widest range of afford- able medications.’ Hexal Australia’s 50 staff is involved in the sale, marketing and distribution of 140 generic pharmaceutical products includ- ing 224 new lines which are planned for roll-out during the next three years. Mr von Oswald said that he expected this number to increase significantly as a result of the merger. New Hexal products include block- busters such as the anti-ulcerant, Mepra- zol (omeprazole) and its brands of the lipid-lowering medication, simvastatin and the anti-depressant, sertraline. Mr von Oswald assured pharmacists that during the merger period, Hexal Australia would continue to develop its highly successful Pharmacy First Program as part of its ‘business as usual’ approach. The merger process is expected to be complete by the end of 2005. ¦ purchase of IT support company Osella Computers Pty Ltd and opening of a Brisbane office. PCA NU Systems strengthens IT support in Queensland P CA NU Systems Pty Ltd has increased its presence in Queensland with the The Brisbane office consolidates national support for pharmacies, accord- ing to PCA NU Systems chief executive officer Paul Naismith. ‘We’re very excited about bringing Osella into our team and opening a local office. Having a Brisbane office is a vital step in providing pharmacies with local coverage and support throughout Aus- tralia. We can now provide on-the- ground support from Brisbane, Perth, Adelaide, Melbourne and Sydney, which means better service for pharmacies. generics strategy led by former Mayne senior executive, Stephen Roche, that aims to cement API’s role as the leading supplier of generic drugs to pharmacists, was one of a number of announcements made recently by Aus- tralian Pharmaceutical Industries (API) to the financial community and phar- macy customers. API lures Stephen Roche to lead generics strategy A ‘As our reseller in the region for the past 10 years, Osella is the ideal partner to extend our business and presence in the region.’ Pharmacies will immediately benefit from a strengthened local presence and team, according to Vaughan Reed, Queensland state manager, PCA NU Sys- tems (previously general manager, Osella). ‘Osella has been the public face of PCA NU Systems in Queensland and northern New South Wales for the past 10 years. Joining forces is a terrific step for phar- macies in the region. It means we now have a significantly larger team to support pharmacies locally, and can take our busi- ness in the area to the next level. 268 ? THE AUSTRALIAN JOURNAL OF PHARMACY VOL.86 APRIL 2005 Also announced were a rationalisation of replenishment buying, a debtors improvement program, the repositioning of three of its pharmacy brands (Priceline, Soul Pattinson and Pharmacist Advice) and improvements in the efficiency of its distribution function. At the centre of API’s new generics strat- egy is an exclusive distribution agreement with Hexal, which was recently acquired by Novartis and was the world’s fourth largest generics manufacturer (see story same page). When added to Sandoz, pre- viously the largest generics manufacturer in the world and also owned by Novartis, the new Sandoz/Hexal entity is expected to generate significant market power. In Australia alone, Hexal is expected to introduce 224 product lines in addition to the 118 product lines already offered. Fur- thermore, 1,150 pharmacies have signed a document of intent to purchase Hexal products in the future, representing 24 per cent of the potential market. API group leader Jeff Sher said the Hexal agreement was part one of a three- part strategy for the distribution of gener- ics to the Australian market. The two other parts of the strategy, which aims to deliver a ‘one-stop shop’ capability, would be announced in the months ahead, Mr Sher said. ¦ When finalised, the generics stratefy would enable easier ordering and process efficiency. ¦