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PTT invests in Lotus, strategic partnership in south east Asia

Business
19 April 2021
  • The transaction creates very strong platform to facilitate the market access to the largest pharmaceutical market in ASEAN
  • Both parties are committed to further collaboration to provide patients better access to high quality medicines across the region

Lotus Pharmaceutical Co., Ltd. (“Lotus” or “the Company”, Taiwan TWSE ticker: 1795) today announced the issuance of new shares through private placement to be sold to Innobic (Asia) to further strengthen its market access in ASEAN. Innobic (Asia) is the wholly owned subsidiary of PTT Public Company Limited (“PTT”, SET ticker: PTT), the largest publicly-listed conglomerate in Thailand majority owned by Ministry of Finance Thailand and is the only company from Thailand listed in Fortune Global 500. Innobic (Asia) commits an investment of approximately US$50 million to subscribe 17,517,348 new shares via private placement at the price of NT$80.7 per share. The investment will be done through Innobic LL Holding Co., Ltd., which was recently established under Innobic (Asia) for building up the national ecosystem and serving as the Pharmaceutical and Life Science arm of PTT.

Through this strategic alliance, Lotus and Innobic will jointly explore opportunities in the South East Asia pharmaceutical markets, including but not limited to Thailand, Vietnam, Philippines, Malaysia and other ASEAN countries. On the one hand, Lotus brings to this partnership its existing wide range portfolio and strong pipeline in the region, its R&D and BD capabilities, its overall pharma industry knowledge including highest GMP standards , Supply chain and manufacturing and global network of partners. On the other, Innobic and PTT bring solid market access, local knowledge, creditability, potential commercial network and business relationship.

Petar Vazharov, Chief Executive Officer of Lotus, commented: “We are very excited about this long-term partnership to jointly reinforce Lotus growth in South East Asia. Since early 2020, Lotus has been actively expanding its Asian business from its traditional stronghold of North East Asia to South East Asia. Last year, we consolidated the SEA businesses and product portfolio of Alvogen. We established local footprints in Thailand, Hong Kong, Singapore and Vietnam. We believe the SEA is very attractive region due to higher growth outlook and far less crowded comparing to, for example, China. Thailand, as an example, is the 5th largest pharmaceutical market in Asia, after China, Japan, India and South Korea. However, without a solid local partner, market access is extremely challenging. PTT Group shares the same strategic vision as Lotus. Jointly we are looking forward to building a stronghold in Thailand and beyond, similar to what we have done in Taiwan and South Korea.”

Dr. Buranin Rattanasombat, Senior Executive Vice President, Downstream Business Group Alignment, PTT and Chairman of Innobic (Asia), commented: “PTT Group has continuously expanded our business value-chain to satisfy the changing demands of a diversified and broader customer base. With the rising concern on the importance of healthcare eco-system, it has become a part of our Innobic (Asia)’s strategy to promote innovative medicines in Thailand and South East Asia to improve patient’s access to more affordable medicines with quality. Today’s venture marks yet another successful milestone towards this goal. We are delighted to be partner with Lotus who we trust as leader in the industry.”

The subscription price per share of this private placement is NT$80.7, representing a 5.5% premium compared to the 30-business-day closing average before BOD meeting NT$76.5, or a 1.8% discount to the closing price NT$82.2 as of April 16th, 2021.