Sun Pharma to buy US drugmaker Organon for $11.75 billion

Sun Pharma Industries will buy ​US drugmaker Organon & Co, in an all-cash deal valued at about $11.75 billion including debt, for ‌the largest overseas acquisition by an Indian pharmaceutical company.

The move comes as Sun, India’s biggest drugmaker by market value, steps up a push into higher-margin specialty medicines with a sharper focus on areas such as dermatology, oncology and obesity to ​offset declining U.S. sales.

Shifting tariff policies in the United States have squeezed margins for one ​of India’s drugmakers most exposed to the American market, prompting it to keep open ⁠the option of expanding manufacturing there.

Though positive from an earnings standpoint, the deal is unlikely to materially ​change Sun’s position in the United States, where Organon has a relatively small footprint, said Shrikant Akolkar ​of Nuvama Institutional Equities.

The acquisition will double Sun’s revenue and EBITDA, adding $6.2 billion in sales with robust 30% EBITDA margins, Akolkar said, adding that the deal is projected to be 30% to 40% EPS accretive by FY28.

Sun Pharma’s shares settled ​up 7% for a boost of 271.36 billion rupees ($2.88 billion) in market value, but off a rise of ​as much as 9% after the news.

“It also gives Sun access to markets such as China, Brazil and other emerging ‌regions ⁠where its presence has been limited, helping it scale up as a branded and specialty drugs player,” the pharma analyst added.

Sun Pharma, valued at more than $40 billion, said it would buy Organon for $14.00 a share, or a premium of more than 24% to the April 24 closing price.

Shares of Organon climbed 16% to $14.06 ​in premarket trade.

It plans ​to fund the deal ⁠through cash and committed bank financing, with Organon carrying net debt of about $8.6 billion as of December 31, 2025.

For the same period, Sun’s debt was roughly $198.4 million ​and profit stood at $1.16 billion.

With funding coming from a strong balance sheet, ​debt concerns should ⁠ease by the third year, positioning Sun as a more dominant player by decade’s end, Akolkar added.

The acquisition is also expected to strengthen Sun’s women’s health portfolio and mark its entry into biosimilars.

It will gain access ⁠to Organon’s ​portfolio of more than 70 women’s health and general medicines ​sold across about 140 countries, adding global scale and a steady cash‑generating business alongside its specialty pipeline.