SAO PAULO, Sept 19 (Reuters) - Blau Farmacêutica SA, a Brazilian maker of kidney and cancer medicines, is working with banks on an initial public offering aimed at raising money to accelerate an expansion drive across Latin America, three people familiar with the matter said.
Blau has discussed underwriting roles with the investment-banking units of Itaú Unibanco Holding SA, Banco Safra SA and Morgan Stanley & Co, among others, according to the people. Neither Blau nor the banks have decided on a timetable for the deal, which depends on market conditions, they added.
A spokeswoman for Blau, which is controlled by Chief Executive Officer Marcelo Hahn, declined to comment, as did São Paulo-based Itaú and New York-based Morgan Stanley. Press representatives for Safra did not have an immediate comment.
Blau's quest for investor money shows how pharmaceutical deals are gaining steam in a region where demand for medicines is spiking. Biotech investors, who are burning through cash more quickly than ever, are raising money in equity markets in an effort to turn their companies into specialty pharmaceutical firms.
In July, Colombia-based Grupo Biotoscana SA and shareholders raised 1.34 billion reais ($427 million) in a São Paulo IPO. In March, Biomm SA raised about 30 million reais in a follow-on offering.
In the 12 months through July, there were 21 pharmaceutical-related mergers and acquisitions in Latin America and the Caribbean, alongside two regional pharmaceutical IPOs and two follow-on offerings that raised almost $1 billion over the same period, according to Thomson Reuters data.
Founded about three decades ago, Blau last year earned net income of 28.7 million reais and had operational profit of 65 million reais, on revenue of 431 million reais. Profit rose 30 percent from 2015, according to financial statements published on Blau's website.
Based in the Brazilian town of Cotia, west of São Paulo, Blau has nearly 20 plants and production facilities where it has developed more than 100 different types of medicines. Blau currently has units in Argentina, Chile, Colombia, Peru and Uruguay and is bound to open one in Mexico.
Blau also exports medicines to Yemen, Azerbaijan, Malaysia and Pakistan, among a number of Asian and Middle East countries.
$1 = 3.1356 reais Reporting by Guillermo Parra-Bernal