Stada CEO confirms company may be for sale

Rumours that German pharma Stada may be up for sale have been all but confirmed by the company's chief executive, who told a news agency that "exploratory talks" are taking place.

Peter Goldschmidt told the dpa Press Agency that Stada's private equity owners Bain Capital and Cinven are in an "orientation phase" regarding an exit from the business which they bought out in a €4.1 billion deal in 2017, around $6 billion at the exchange rates of the time.

However, he does not expect an agreement to be reached until 2024 at the earliest, as the owners are under "no pressure to sell." Cinven and Bain Capital have declined to comment on the matter.

Bloomberg first reported the possibility of a sale a couple of weeks ago, suggesting that the generics and over-the-counter drugs business could fetch as much as €10 billion ($11 billion).

Goldschmidt's comments came as Stada reported a healthy 16% increase in first-half revenues to almost €2.1 billion, with operating profit shooting up 30% to €509 million. The CEO is predicting that, for the full year, Stada will top €4 billion in revenues and €1 billion in profit for the first time.

The business has seen a dramatic turnaround since Cinven and Bain took it into private hands, at a time when annual sales were €2.2 billion and the company was facing an investor revolt amid claims it was underperforming its peers in the market.

They were particularly unhappy that the company had eschewed the M&A wave that had swept through the generics industry at the time, missing an opportunity to grow the business, and was not operating efficiently with a high cost of sales.

Since that time, the 125-year-old business has made a series of bolt-on deals, repurchasing rights to the Ladival sunscreen range, buying rights to the anti-dandruff shampoo Nizoral in EMEA markets, and taking a majority stake in Bioceuticals to create the foundation for a biosimilars business.

It also bought various brands from GSK and Takeda, central European consumer health business Walmark, formed a strategic partnership with Alvotech for seven biosimilars, and acquired Sedeen's Lobsor Pharma, claiming rights to a triple therapy for Parkinson's disease.

Just this month, it also took control of a range of Sanofi consumer health brands in Europe, including pain reliever Antistax, allergy eye drops Lomudal and Opticrom, and the Omnivit range of vitamin supplements.