Is Stada looking at another Russian M&A prospect?

Does Stada CEO Hartmut Retzlaff know something we don't about his company's dealmaking prospects in Russia? In March, Reuters reported that the German company had failed to pull off a couple of promising Russian acquisitions. In April, the company said it was reviewing its operations in the country and might shutter two of its plants there.

Now, Retzlaff says he's expecting Stada's Russian sales to surpass domestic revenues by 2015. In an interview with Germany's Handelsblatt, Retzlaff outlined plans to drive growth in Eastern Europe over the next few years, especially in Russia. Right now, 28% of Stada's €1.7 billion ($2.14 billion) sales comes from Germany, while 16% is sourced in Russia.

When Stada announced its review of Russian manufacturing, it said it wanted to streamline operations there to prepare for growth, and two of its four plants were operating below capacity. One of the plants it plans to keep is a former Hemofarm facility; Stada bought the Serbian drugmaker in part because of its Russian connections and production capacity.

Meanwhile, Stada is buying up Russian products, if not Russian drugmakers. The company agreed to purchase the Russian rights to two drugs, including the anti-bleeding drug Tranexam. But Retzlaff recently admitted that a piecemeal approach won't deliver the kind of critical mass Stada needs in the consolidating generics world. So, will Retzlaff stick to expanding its product portfolio and boosting Russian production--or will he manage a buyout after all?

- read the Reuters story
- get more from Handelsblatt (in German)