U.S. drugmaker Merck & Co has formed a joint venture with India's Sun Pharmaceutical Industries Ltd to develop and manufacture branded generic drugs for emerging markets, the two companies said on Monday. The companies did not disclose financial details of the deal.

"It will leverage Merck's market presence (and) regulatory competence across emerging markets," Sun's chairman and managing director, Dilip Shanghvi, said at a media briefing. "This will help us optimize the potential for JV products."

Faced with stalling sales in mature Western markets, rising competition and loss of patent protection on several of their drugs, Western drugmakers are increasingly looking at emerging markets for growth.

"The joint venture will help to further strengthen our position for leadership in some of the world's fastest growing geographies," said Kevin Ali, president of emerging markets at Merck.

Last year, Anglo-Swedish drug maker AstraZeneca struck its first branded generics supply deal with India's Torrent Pharmaceuticals, a year after rival British drug maker GlaxoSmithKline tied a similar branded generics deal with India's Dr Reddy's Laboratories Ltd . Cheap off-patent medicines sold in high volumes in emerging markets under a multinational brand name are a growing target for major drugmakers.

In January, German drugmaker Bayer signed an   agreement with India's Cadila Healthcare to set up a   joint venture to market products locally. Shares in Sun Pharmaceutical gained 2 percent at close in a weak Mumbai market.