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When Hikma Pharmaceuticals was promoted to London’s FTSE 100 index a year ago, it looked like just the latest waymarker in the relentless rise of the Jordanian generic drugmaker.

A year later, however, investor enthusiasm towards the company has faded — so much so that the stock fell back out of the index in the latest revisions to its membership this month.

The shift in sentiment reflects uncertainty over Hikma’s outlook after its acquisition of Roxane, the US generic drugs unit of Boehringer Ingelheim, in by far the biggest deal since the company was founded 38 years ago.

Hikma agreed last July to pay $2.65bn in cash and stock for Roxane but the $1.18bn cash portion was reduced by almost by half before the transaction was completed last month.

The renegotiation reflected lower-than-expected sales from Roxane. Continued weakness in the business will weigh on Hikma’s performance this year — guidance for 2016 issued last week fell short of analysts’ expectations.

But Said Darwazah, Hikma’s chief executive, says near-term pressures on Roxane have done nothing to dim his enthusiasm for a deal that promises to make the enlarged company the sixth biggest producer of generic drugs in the US.

“One of the good things about Hikma is that we are willing to do things that give us strength in the medium to long term,” he says, predicting “strong growth from 2017 onwards”.

This polite dismissal of the 23 per cent share price decline over the past six months reflects Mr Darwazah’s firm grip over the company his late father founded. Mr Darwazah, whose family controls a 26 per cent stake, says the appeal of Roxane was its pipeline of new products, rather than the existing portfolio.

Prospects include a generic version of GlaxoSmithKline’s best-selling Advair asthma drug, which lost patent protection in 2010 but is yet to face competition because of the complexity of the associated inhaler device.

This is an example of the high-value generics for conditions ranging from heart disease to cancer that Mr Darwazah believes will allow Hikma to prosper in a rapidly consolidating market. The rise of low-cost Indian manufacturers such as Sun Pharmaceutical Industries and Dr Reddy’s Laboratories has spurred a wave of mergers and acquisitions among rivals.

Teva of Israel is close to completing its $40bn takeover of Allergan’s Actavis generics division and Mylan of the US last month agreed to buy Meda of Sweden for $7.2bn. Meanwhile, Pfizer has become a direct competitor of Hikma’s in injectable medicines after its $17bn acquisition of Hospira.

“We can’t compete in the major commodity products with Teva and the Indian manufacturers,” admits Mr Darwazah. “We are focused on products without many competitors, where we can move faster and build relationships with customers.”

Analysts have broadly backed his strategy. Max Herrmann at Stifel says the lowered price of the Roxane deal “more than offsets the dilution to earnings for Hikma in 2016”.

James Vane-Tempest at Jefferies continues “to believe that the deal transforms Hikma’s . . . prospects”.

Roxane marked Hikma’s second deal with Boehringer Ingelheim in the past two years after the $300m acquisition of the German company’s Bedford Laboratories unit in 2014. The two transactions have left privately held Boehringer with a 16.7 per cent stake in Hikma and a seat on the board. Analysts predict strategic collaboration between the pair in manufacturing and distribution.

Hikma’s US expansion has reduced its dependence on the Arab world at a time when political instability and oil price weakness is putting pressure on the region’s economies. The Middle East and north Africa has fallen from 61 per cent of company sales in 2010 to 46 per cent last year.

During the same period, annual revenues have doubled to $1.4bn and operating profits have tripled to $409m.

Mr Darwazah insists there is no retreat from Hikma’s home region, where strong growth in markets such as Egypt and Morocco last year offset declines in war-torn Iraq and Libya. “There will be some slowdown because of the oil price and wars but Hikma is continuing to grow and Roxane will give us new products to sell [in the Middle East and north Africa].”

Khalid Nabilsi, Hikma’s chief financial officer, says the company has capacity for further bolt-on deals but the main focus was the integration of Roxane.

A share price rebound in recent weeks has pushed the company’s market capitalisation back above several FTSE 100 constituents at $4.5bn. Mr Darwazah says he hopes to be back in the blue-chip club soon.

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