Inovax postpones PT Ponco purchase

Inovax postpones PT Ponco purchase

PERTH (Reuters): Australian drug developer and distributor
Inovax Ltd said it would postpone the purchase of Indonesian drug
maker PT Ponco for A$94.6 million due to Southeast Asia's
economic turmoil.

"Due to the recent volatility in economic conditions in SE
Asia and in particular the significant devaluation of the
Indonesian rupiah, Inovax has decided to defer its proposed
acquisition of the Indonesian pharmaceutical manufacturer PT
Ponco which it announced on July 14, 1997," Inovax said.

Inovax said it remained committed to an expansion into drug
making to complement distribution and product development.

But it believed that current economic conditions may now allow
this to be achieved on more attractive terms.

"The present economic conditions in Indonesia, whilst
difficult for many sectors of the economy have not had any major
adverse impact on sales in our Indonesian operations during the
past few months", Inovax chief executive officer Tony Fitzgerald
said in a statement.

"Consumption of pharmaceuticals, particularly prescription
drugs in an emerging market tends to be relatively immune to
economic downturns and in Indonesia has demonstrated a
consistently strong growth trend over the past decade," he said.

"Inovax believes these growth rates are likely to continue
notwithstanding the present economic volatility," Fitzgerald
added.

The proposed vendor of Ponco was the Saputra family, Inovax
said in July.

Indonesia's Bakrie Group had been expected to help finance the
acquisition and to gain majority control of Inovax once the deal
was completed.