Private equity (PE) continues to be a force in changing the face of the global healthcare industry. STADA, a prominent generic drug manufacturer based in Germany, was taken private last week (8/18/2017) in a $6.3 billion dollar deal. Bain Capital and Cinven were the buyers. Consolidation in the healthcare industry has been rampant and the generic drug producer sector is not immune to it. There are two key considerations in this deal. First, it is the largest private equity deal to date for a German-based company. Second, it could be the stepping stone to another PE deal. French pharmaceutical manufacturer Sanofi has plans to sell its European generic drug unit in the near future. It may be a fitting asset to be combined with STADA. Bain and Cinven would have a formidable generic manufacturing organization in their portfolio which they could cultivate for income, spin off in a public offering or sell directly to a pharmaceutical manufacturer. While they could do this based on the STADA deal alone, bolstering it with Sanofi’s generic unit would make it larger and potentially that much more profitable in any of the three options. The tandem would allow for a larger product portfolio for competitive marketing purposes against other generic drug makers along the way. John Baresky Healthcare Marketing Leader, Pharmaceutical Marketing, Digital Marketing Strategy, Content Marketing Strategy, Market Access Strategy, Healthcare RPA Software Marketing Strategy

1. $6.3 Billion: Pharmaceutical Manufacturer STADA
Disappears Behind The Curtain Of Private Equity…
Bain Capital and Cinven take STADA behind the private equity curtain
Private equity (PE) continues to be a force in changing the face of the global healthcare industry. STADA, a
prominent generic drug manufacturer based in Germany, was taken private last week (8/18/2017) in a $6.3
billion dollar deal. Bain Capital and Cinven were the buyers. Consolidation in the healthcare industry has been
rampant and the generic drug producer sector is not immune to it.
There are two key considerations in this deal. First, it is the largest private equity deal to date for a German-
based company. Second, it could be the stepping stone to another PE deal. French pharmaceutical
manufacturer Sanofi has plans to sell its European generic drug unit in the near future. It may be a fitting asset
to be combined with STADA. Bain and Cinven would have a formidable generic manufacturing organization in
their portfolio which they could cultivate for income, spin off in a public offering or sell directly to a
pharmaceutical manufacturer. While they could do this based on the STADA deal alone, bolstering it with
Sanofi’s generic unit would make it larger and potentially that much more profitable in any of the three options.
The tandem would allow for a larger product portfolio for competitive marketing purposes against other generic
drug makers along the way.
Additional gains would be realized through the inevitable cost cutting measures applied to each organization.
Conceivably, the STADA deal may drive the price higher for the Sanofi unit if it is a pivotal target in Bain Capital
and Cinven’s strategy. Sanofi may be able to extract more payment from them or other drug manufacturers
seeking to buy the Sanofi unit. Healthcare continues to be a sector ripe with mergers and acquisitions; both
public and private monies are being strategically exercised to gain maximum short and long term advantages.
Bain and Cinven’s STADA deal has the makings of a lucrative profit platform in the pharmaceutical industry.

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