Dr. Reddy's shopping for deals up to $1B as it expands in injectable meds

Dr. Reddy's Laboratories is eyeing deals as big as $1 billion to build up its portfolio of higher-end products, including generic injectable drugs, and expand its footprint in emerging markets.

Dr. Reddy's CEO G.V. Prasad

The Hyderabad, India-based company is scouting for a range of products and buyouts--everything from dermatology and migraine treatments to new drug delivery systems and nanotech. It's also eyeing deals that would build up its presence in Latin America, CEO G.V. Prasad told Bloomberg.

Dr. Reddy's is up for a set of small acquisitions or bigger deals worth as much as $1 billion, Chief Financial Officer Saumen Chakraborty added. "I think in the next two years it will be very important for us to make some good moves on inorganic growth," Chakraborty said.

Meanwhile, Dr. Reddy's plans to ask the FDA to approve four or 5 complex injectables in the next 24 to 30 months, Chief Operating Officer Abhijit Mukherjee told Bloomberg. The Indian pharma already boasts complex products such as patches, eyedrops and topic medications, but expanding into injectables would give it some insulation against competition, plus the opportunity to charge higher prices.

If all goes to plan, the company will reap about 60% of its U.S. sales from complex products in three years, up from about 25% today, Chakraborty said.

Inking new deals and diving into injectables could also help Dr. Reddy's weather trouble in its generic pill business. In November, the FDA slapped Dr. Reddy's for manufacturing problems at a plant producing active ingredients for several drugs, including its knockoff version of AstraZeneca's ($AZN) heartburn med Nexium. Dr. Reddy's has since transferred manufacturing to another site and is shooting to launch the Nexium generic by March 2016, Mukherjee said.

Dr. Reddy's is not the only generics company with injectable-drugs ambitions. In 2013, Mylan ($MYL) snatched up Strides Arcolabs' injectables unit Agila Specialties for $1.6 billion, adding another 200 products to its injectables portfolio and expanding its geographic footprint. Last year, Par Pharmaceutical shelled out $490 million for JHP Pharmaceuticals to beef up in generic injectables, and India's Lupin scooped up Netherlands-based Nanomi to break into the market.

Jordan's Hikma also jumped on the injectable bandwagon in 2014, paying Boehringer Ingelheim up to $300 million for injectable drugs once made at its shuttered Ben Venue plant. Hikma said at the time that it would reintroduce the products, addressing "critical supply shortages in the U.S. market" that stemmed from the plant's quality problems.

- read the Bloomberg story