Betapharm, Germany’s fourth-largest generics company, has reportedly been approached by India’s Dr Reddy’s Laboratories with a 450 million-euro ($540m) acquisition offer.

If confirmed, the deal would the biggest example so far of an Indian company buying a local player in Europe or the USA.

Dr Reddy’s is just one of several suitors circling Betapharm, according to UK private equity group 3i, which bought a majority share in the German company in 2004 for 300 million euros. 3i has not confirmed yet whether it is prepared to sell Betapharm; it originally intended to hang onto the firm for five years.

Fellow Indian companies Ranbaxy, Nicholas Piramal and Zydus Cadila have all been rumoured to be interested in Betapharm, while Wockhardt has reportedly ducked out of the race, according to Indian newspaper reports.

Others said to be interested in Betapharm include Teva, now the world’s biggest generics company following its merger with IVAX of the USA, and number two-ranked Sandoz. Both of these companies have achieved their market positions on the back of a string of acquisitions in the generics sector, and could be interested in Betapharm to shore up their activities in Germany, which is Europe’s largest generics market.

Betapharm was founded in 1993 and has a product range encompassing around 145 active substances. It employs a workforce of around 350 people and in 2004 achieved a turnover of 161 million euros.

Meanwhile, news of the interest in Betapharm also led to renewed speculation that the number three German generics company, Stada, may also be an acquisition target.

- In other news, Dr Reddy’s has entered into an agreement to develop a novel approach to the treatment of chronic obstructive pulmonary disease with UK-based privately-held drug discovery firm Argenta.

Under the terms of the agreement, the two firms will collaborate to identify clinical candidates from a certain undisclosed class of Dr Reddy's' compounds for use as potential COPD treatments. Both parties will jointly develop the selected candidates from the preclinical stage up to Phase IIa.