RanbaxyRanbaxy Laboratories on Tuesday said it was selling its 50 per cent stake in its Japanese joint venture Nihon Pharmaceutical Industry (NPI) to its partner Nippon Chemiphar.

Although Ranbaxy did not give any amount, international media reports valued the 50 per cent stake at $18 million. Ranbaxy is now a part of another Japanese company Daiichi Sankyo, which now owns 64 per cent in the Indian company.

A Mumbai-based pharma analyst with a global bank said the break up of the JV was expected because it did not make sense for Ranbaxy to partner a Japanese company when its majority stake owner is Daiichi Sankyo.

“Following this transaction, NPI will become a wholly owned subsidiary of Nippon Chemiphar,” Ranbaxy said in a statement, adding that it is in the best interest of both the partners to develop their generic businesses independently in Japan.

At present, the Gurgaon-based Indian company supplies about seven drugs to the JV which will be terminated gradually to enable a smooth transition.

Japan is the world’s second largest pharma market after the US. The Japanese government is in the process of providing a relaxed regulation to promote the use of low-cost generic drugs to reduce healthcare cost.

The development is expected to pave the way for Daiichi Sankyo and Ranbaxy to sell their generic drugs in Japan on their own.