The largest Indian drug company by revenue and the most valuable, Sun Pharma is competing with Swedish buyout group EQT and German drugmaker Gruenthal, a specialist in pain management.
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Sun’s final all-cash offer is fully financed by three global banks—JP Morgan, MUFG and Citi—to the tune of $12 billion. If Sun trumps the competition, the plan is to merge NYSE-listed Organon with Sun. However, Organon’s shareholders will not receive any Sun Pharma shares. JP Morgan is also Sun’s adviser.
Organon’s stock price has zoomed nearly 52% in the past month as the buyout buzz around the company has intensified
Refinancing of Debt
Earlier, its shares were down 19.06% after a brief spurt in January following news of Sun’s move on Organon becoming public. Its market cap is $2.4 billion, according to NYSE.
Sun Pharma closed Thursday with a market valuation of Rs 4.03 lakh crore ($42.8 billion). The frenzy around the Organon stock has abruptly shifted attention away from its negatives–leveraged balance sheet and muted growth expectations— and to what a buyer might see in its portfolio, cash generation and carve-out value.Also Read | Sun Pharma looks to rise in US with $10 billion Organon buy
ET was the first to report on January 19 that Sun was scoping out Organon, a debt-ridden US company that specialises in women’s health that was spun off from MSD (Merck Sharp & Dohme) in 2021. On April 10, ET reported that Sun was preparing to make a final offer, sparking a 29% rally in the following session.
Sun Pharma and Organon didn’t respond to queries. EQT and Gruenthal declined to comment.
Buyers of Organon will have to refinance the debt it inherited from MSD. Organon ended 2025 with $8.64 billion in debt and guided for 2026 revenue of $6.125-6.325 billion, versus $6.43 billion reported for 2025.
Bigger, Bolder
Sun’s financing plan is predominantly aimed at taking on the debt. The Mumbai-headquartered company also has about $3.2 billion (Rs 26,000 crore) of net cash on its balance sheet that it plans to use to buy the equity of the target. The valuation is linked to the market cap plus premium, along with debt.
In recent months, Sun Pharma chairman Shanghvi has stressed the need for Indian drugmakers to pivot to innovative research for the next phase of growth while maintaining their lead in the generics business and, if necessary, consider acquisitions to build scale. In FY26, Sun Pharma clocked sales of Rs 52,000 crore, with the US and India contributing almost an equal share of 31-33% while the rest was split up among other markets and active pharmaceutical ingredients (APIs).
The US company’s portfolio and prospects around women’s health–in areas such as breast cancer, contraception, osteoporosis and menopause –and biosimilars is attractive to suitors.
“Organon’s longer-term positioning remains strong, as women’s health growth rebounds and biosimilars become a more meaningful growth driver with recent portfolio expansion. The company also has a solid asset in VTAMA (skin medicine),” said Navann Ty, analyst at BNP Paribas. “A potential deal with Sun Pharma could be positive. On the other hand, we view a potential deal as negative for Sun Pharma, as it could be perceived as imprudent capital allocation, diverting focus from the specialty India business while adding leverage.”
The drugmaker has been in play since late last year when it decided to sell its JADA post-partum haemorrhage (PPH) treatment system to Laborie Medical for up to $465 million, a move seen as a pivot from female health devices to women’s biopharmaceuticals.
Other Contenders
EQT is one of Europe’s largest life sciences and pharma investors. In January, it initiated talks with Oxford BioMedica over a possible takeover of the FTSE 250 gene and cell therapy group but backed out a month later.
Closely held Gruenthal operates in 28 countries with affiliates and has a footprint in around 100 countries. In 2025, it reported revenue of €1.8 bn and adjusted ebitda of €500 million. It has made five acquisitions in as many years, ranging from men’s health to pain therapies and branded therapies.
“The company has historically bought cash-generating specialty pharma assets or done bolt on acquisitions,” said a London based M&A advisor closely following the transaction. “It’s surprising that they are going for a one-off transaction so big and complex.”
Since 2017, the company has spent a little over €2 billion on acquisitions. Two of its largest deals were the €550 million buyout of Nebido from Bayer and the $250 million deal for Valinor in the US, marking a strategic pivot.
