DAIICHI Sankyo Co will buy control of India's Ranbaxy Laboratories Ltd for as much as US$4.6 billion, entering a generic-drug market that is growing twice as fast as branded medicines as government price cuts erode profit.

Japan's third-largest drug maker will acquire more than 50.1 percent of Ranbaxy for 737 rupees (US$17.19) a share, 31 percent higher than Tuesday's closing price, Tokyo-based Daiichi Sankyo said yesterday. Chief Executive Officer Malvinder Singh will keep his post at Ranbaxy, which will remain listed on India's stock exchanges, Bloomberg News said.

The purchase propels Daiichi Sankyo to ninth in the US$120 billion generic-drug market behind leaders Teva Pharmaceutical Industries Ltd and Novartis AG's Sandoz unit. Daiichi Sankyo is mimicking strategies pursued by the Swiss pharmaceuticals company and Johnson & Johnson to weather turbulence in the branded-drug industry by diversifying into other markets. The purchase also gives the Japanese firm more reach in emerging regions including India and China.

"The essence of the deal is Daiichi Sankyo will seriously challenge the generic business," said Fumiyoshi Sakai, a healthcare analyst at Credit Suisse Securities Ltd.