Amoxiciline, paracetamol, ibuprofen… So many everyday medications, often marketed in France under the brand Biogaran, the leader in French generic medications which produces no less than 900 references, and employs 8,600 employees. But he could soon change his nationality. According to information from Echoes which follow the revelations of “L’Informé”, the Servier group launched the sale of Biogaran last year, and four potential buyers, including two Indians, are said to have positioned themselves, raising fears of relocation of production.
The French brand produces, in fact, 50% in France, and 90% in Europe, but does not have its own factories. It uses subcontractors, which would make it easier for a buyer wishing to relocate, by simply not renewing the contracts.
Sales at a loss, taxes…
Among the drugs distributed in France, around 150 of the 900 references are sold at a negative margin, with the State regulating drug price increases and taxing the turnover linked to the sale of generics. Last September, on FranceinfoJérôme Wirotius, general director of Biogaran, sounded the alarm: “We have very strongly and very strongly alerted the public authorities that we will not be able, neither we nor the other generic laboratories, to do one more year with a context of inflation and new taxes which are today confiscatory.”
The brand, which supplies 32% of the French generic market, would like to internationalize in more profitable markets than France, where generics are among the cheapest in Europe. This sale is also linked to the Servier group’s desire to focus on the development of innovative drugs, including oncology.
Among the potential buyers, two European financial investors made an offer, considered too low: only 700 million euros. Two Indian generics, Torrent Pharmaceuticals and Aurobindo Pharma, could thus be better positioned for a recovery. A hard blow for pharmaceutical subcontracting, including more than 8,000 jobs dependent on the manufacture of Biogaran remedies. If it wishes to block the sale, the Ministry of the Economy can, however, always invoke the question of sovereignty.