Eurofarma, which has just closed a partnership with Pfizer and BioNTech to produce vaccines against covid-19 for Brazil and Latin America, has become one of the largest drug companies in the region in recent years. The company, founded in 1972, had a good year even during the pandemic: it reached sales of R$ 6.2 billion last year, an increase of 16% compared to 2019.
Today, Eurofarma is one of the giants of generic medicines in Brazil, which had its commercialization released in 2001. It is even one of the main sellers of the medicine sildenafil citrate, the generic of Viagra, of the now partner Pfizer (the medicine’s patent was lost in 2013). The opening of this market was fundamental for several Brazilian laboratories to gain scale and importance within the national market.
Before that, the company made a series of acquisitions to become one of the largest in the country. In 1982, for example, it bought ISA, the first Brazilian laboratory to produce penicillin. In its entire history, there were more than ten acquisitions. With this, the company operates in most pharmaceutical segments, such as prescription and over-the-counter medications, oncology, veterinary and hospital.
The agreement signed with the American Pfizer is part of the company’s international plans, which became the first multinational in the sector to be born in Brazil. The forecast is that more than 100 million doses will be manufactured annually, destined for countries in Latin America. In the last decade, the order within the company was to expand business abroad. The first step was taken in 2009, when the company bought the Argentinean Quesada Farmacêutica.
However, acceleration has occurred even in recent years. In March 2020, the drugmaker signed an agreement with Hypera to buy Takeda’s former Latin American operation for $161 million. The deal was completed in January of this year and represented the company’s biggest acquisition in value, which added 12 medicines to the company’s portfolio, including their own and licenses, which generate US$ 38 million in annual sales.
With the acquisition, businesses outside Brazil now represent 20% of Eurofarma’s revenues, which intends to increase this share to 30% next year. Eurofarma operates in 20 countries in Latin America and has seven factories across the region – only three operate in Brazil. But the deal with Pfizer may represent a beginning of expansion to other regions, in the view of industry consultants.
“Pfizer must have seen Eurofarma’s penetration in Latin America as a differential, as well as the company’s operation, which is on the top shelf of the sector. For Eurofarma, entry into a segment such as vaccines will also be positive,” says Lourival Stange, an expert in the pharmaceutical industry and partner at Solution consulting.
The consultant himself does not see the issue of the company not having experience in the area as a problem. “The production of the vaccine is very similar to that of conventional medicines, with a few adaptations, and Eurofarma had been investing a lot in research and development”, he says.
It also helps that Eurofarma directly receives the active pharmaceutical ingredient (IFA) from Pfizer. Manufacturing will begin next year and annual production could reach 100 million doses when factories are at full operational capacity.
“We are making available our best resources in industrial capacity, technology and quality for this project, so that we can fulfill the contract with excellence and contribute to supplying the Latin American market,” said Maurizio Billi, President of Eurofarma, through a note.
The company’s president is the son of the immigrant Galliano Billi, who founded the company almost 40 years ago and died in March of last year. Maurizio, who took over the business in the early 2000s, continues to run the company until today and has become one of the richest men in the country. According to the magazine forbes, is the 56th richest person in Brazil, with a fortune estimated at US$ 1.4 billion. Sought, Eurofarma declined to comment.