For the pharmaceutical sector, 2009 was a year when Indian manufacturing capabilities took centre stage. For the first time, global pharmaceutical giants like Pfizer and GlaxoSmithKline (GSK) came shopping for Indian manufacturers. recaps some of biggest inbound pharma deals this year.

2008 was a year remembered for Daiichi's Ranbaxy acquisition. But 2009 will be remembered for a deal starkly different in structure. GSK partnered with Hyderabad-based Dr Reddy's to develop and market generics and formulations. Analysts say it’s a win-win for both. While GSK gets high-class manufacturing at one fifth the cost, DRL enhances its reach in markets like Africa and Latin America without having to spend a penny on infrastructure.

It’s not just GSK. Pfizer struck two in-licensing deals this year with Aurobindo Pharma and Claris. Both deals are supply agreements, which enable the Indian companies to reach far-flung markets through Pfizer's network. Never before has Indian manufacturing gained more prominence. That's not to undermine acquisitions that have taken place this year.

Sanofis Aventis acquired Shanta Biotech for a whopping USD 781 million dollars. Recently, Chennai-based Orchid Chemical sold its injectable business to Hospira for USD 400 million, at four times its sales.

“Hospira wanted to have a footprint in India so having a manufacturing capability in India in a subject like injectables and having a cost effective system is a very important aspect for Hospira's backward integration plan,” says Vikas Dandekar, Bureau Head, Pharma Asia News. “So MNCs may not look at Indian companies from a valuation point of view, it may be more an issue of integration for them or a need to be in India.”

For Orchid Chemicals, it was need of the hour. The company wanted to wipe its debt of Rs 1,400 crore. Another company in a similar plight this year was Wockhardt. It filed for corporate debt restructuring at a time when its debt was Rs 3,400 crore. It sold its animal health business to Abbott for USD 130 million and 10 hospitals to Fortis Healthcare for Rs 910 crore.

2010 may be a year when inbound deals will be aplenty as blockbuster drugs in the developed markets come close to patent expiry.