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21 May 2010 By Robert Cyran Follow @rob_cyran

Big Pharma s most important drugs are losing patent protection, growth in developed markets has slowed to a crawl, and much of its cash is trapped overseas. Abbott s $3.7 bln purchase of Piramal Healthcare s generics arm offers a partial response.

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Abbott agreed on May 20 to buy Piramal Healthcare Solutions, a manufacturer of branded generic drugs, from India's Piramal Group for $3.7 billion. The U.S. healthcare company will pay $2.12 billion upfront and $400 million annually for the next four years.

Abbott estimates the Piramal business should have more than $500 million of sales in India this year. Abbott estimates the growth of its Indian pharmaceutical business in total should increase 20 percent annually over the next several years, with expected sales of more than $2.5 billion by 2020.

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