Eurofarma Laboratorios Ltda acquired the entire share capital of Segmenta Farmaceutica Ltda (Segmenta), a Sao Paulo-based manufacturer of pharmaceuticals. Terms of the investment were however not disclosed. On completion, Segmenta will be renamed Eurofarma Segmenta.

The Brazilian generic drug maker Eurofarma said the investment is geared at reinforcing its expansion plans with the acquisition of Segmenta. Segmenta is a domestic laboratory specialized in intravenous drips and aseptic products, which has a strong presence in public and private hospitals. CFW believes the merged companies will benefit from synergies in their existing product portfolios and distribution channels.

Maria Del Pilar Munoz, Eurofarma’s sustainability and new businesses director said the main objective of the merged firm, now called Eurofarma Segmenta, is to become the leader in the hospital setting, offering clients a broad and complete range of injectable and oral generic drugs. The hospital market is one of the sectors with greatest potential for expansion in Brazil.

In 2009, Segmenta generated BRL140mn (US$81.9mn) in sales and it expects its total revenue for 2010 to reach BRL200mn (US$117mn). According to Brazilian newspaper Valor Economico, the intravenous drips market in Brazil is worth around BRL1.2bn (US$703mn) annually and is expanding.

Eurofarma’s sales totaled BRL1.2bn (US$703mn) in 2009 and the generic drug maker is projecting growth of 17% for the current financial year – with total sales expected to reach BRL1.4bn (US$820mn). At present, 90% of Eurofarma’s revenue comes from generic drugs. An important catalyst speeding up the firm’s revenue growth has been the partnership deal signed with the US multinational drug maker Pfizer earlier in 2010 for the commercialization of generic version of the world’s best selling medicine, Lipitor (atorvastatin) that is used to treat cholesterol, in Brazil.

Growth in the generic drug market has been fuelled by Patent Expiries. Brazil’s generic medicines sector is the largest in Latin America, valued at BRL5.08bn (US$2.54bn) in 2009 after another year of strong gains. In 2010, generic drug sales are forecast to account for 17.3% of pharmaceutical sales revenue in US dollar terms. These are relatively low percentages compared with more mature markets, where generic drugs account for over a quarter of sales revenue, highlighting the potential for further expansion in Brazil.

According to the Brazilian Association of Generic Medicines (Pró-Genéricos), 23 medicines will lose patent protection in the country between 2010 and 2011.