Dr. Reddy’s Laboratories Ltd. (NYSE:RDY) announced that it acquired a portfolio of over-the-counter (OTC) brands in the cough-and-cold, pain and dermatology categories from Ducere Pharma. The brands acquired include Doans, Bufferin, Nupercainal ointmnent, Cruex Nail gel, Comtrex and Myoflex.
Dr. Reddy’s plans to ramp up sales and marketing efforts for these brands and will focus on their expansion into existing and new market channels.
Through this acquisition, the company expects to foray into the branded consumer health space.
We note that Dr. Reddy’s is currently facing challenging conditions. Revenues are being hurt by persisting macroeconomic issues in some territories in emerging markets (comprising Russia, the Commonwealth of Independent States, Romania and rest of the world including Venezuela). Moreover, the Venezuela market remains weak, which will continue to impact the top line in the upcoming quarters.
As a result, the company is looking to add strategic assets to its portfolio in order to offset the impact of the aforementioned factors. Previously, the company had acquired UCB’s UCBJF established products business in India, Nepal, Sri Lanka and Maldives in a transaction to expand its footprint in the fast growing areas of dermatology, respiratory and pediatric products. Meanwhile, Dr. Reddy’s is collaborating with Curis for the discovery, development and commercialization of small-molecule antagonists for immuno-oncology and precision oncology targets.
Dr. Reddy’s currently has a Zacks Rank #5 (Strong Sell). A couple of favorably placed stocks in the health care sector are Abbott Laboratories (NYSE:ABT) and Johnson & Johnson (NYSE:JNJ) . Both the stocks carry a Zacks Rank #2 (Buy).
JOHNSON & JOHNS (JNJ): Free Stock Analysis Report
ABBOTT LABS (ABT): Free Stock Analysis Report
UCB SA (UCBJF): Free Stock Analysis Report
DOCTOR REDDYS (RDY): Free Stock Analysis Report
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