Hikma acquires assets of US pharma group
London, May 28, 2014
Hikma Pharmaceuticals, a leading medical group in the region, has signed an agreement with Boehringer Ingelheim Group of Companies to acquire the assets of Bedford Laboratories for $300 million.
Hikma is a fast growing multinational group focused on developing, manufacturing and marketing a broad range of both branded and non-branded generic and in-licensed products. It operates through three businesses: “Branded”, “Injectables” and “Generics”, based principally in the Middle East and North Africa region, where it is a market leader, the US and Europe.
As per the purchase agreement with Ben Venue Laboratories, a member of the Boehringer Ingelheim, Hikma will make an upfront cash payment of $225 million for its US generic injectables business, Bedford.
A further $75 million in contingent cash payments will be paid, subject to the achievement of performance-related milestones, over a period of five years, said the company in its statement.
In addition, Hikma has entered into an exclusivity arrangement with the Boehringer Ingelheim Group to potentially acquire substantially all of the assets of the Ben Venue manufacturing facility in Bedford, Ohio, one of the largest sterile injectable manufacturing sites in the world.
Bedford is a generic injectables company with the third largest portfolio of generic injectable products in the US.
As per the agreement, Hikma is acquiring Bedford’s assets, including a large product portfolio, intellectual property rights, contracts for products marketed under license, raw material inventories, a strong R&D and business development pipeline and a number of employees across key business functions.
The combination of these assets with Hikma’s existing global Injectables platform will significantly strengthen
Hikma’s position as a leading generic injectables company in the US, said a senior official.
"I am very excited to be making this strategically important investment in our Injectables business. Bedford’s impressive product portfolio and deep pipeline will significantly increase the scale and scope of our rapidly growing US Injectables business," remarked Hikma CEO Said Darwazah.
"The large number of high value, niche and differentiated products we are acquiring will strengthen our market position in the US and will benefit patients by bringing back products to the market that are currently in short supply," he stated.
"Through our disciplined approach to M&A, we have established an excellent track record of making value enhancing acquisitions. I am confident that we have the technical capabilities and manufacturing expertise to successfully re-launch the acquired products over the next few years and our success in integrating the MSI acquisition will help to ensure a smooth integration. We remain committed to investing in the long term growth of our Injectables business and we believe that this transaction will deliver significant future value for the Group," added Darwazah.
Paul R. Fonteyne, the US country managing director, president and CEO of Boehringer Ingelheim USA Corporation,
and chairman, Ben Venue board of directors said: "This is a positive development, allowing Hikma to leverage its existing infrastructure and manufacturing capabilities to re-introduce important products to the US market, bringing significant benefit to patients."
"For more than 20 years, Bedford Laboratories and its product portfolio have been of great value to patients, customers and the marketplace. As part of Hikma, the Bedford team will remain focused on strengthening its relationships with customers and continuing to serve the needs of patients," he added.
In 2013, Hikma’s global Injectables business generated revenue of $536 million and accounted for 39 per cent of Group revenue. Investing in the growth and development of this business has been a key strategic priority in recent years.
In May 2011, the company completed the acquisition of Baxter’s Multi-Source Injectables business (MSI), which transformed its US Injectables business, establishing Hikma as the third largest supplier by volume in the US generic injectables market, stated the company in its statement.
The large and fast growing US generic injectables market is valued at around $7.6 billion and offers significant future growth opportunities.
Hikma's strategic focus within Injectables continues to be to increase its US market share by value through investment in a strong product portfolio and pipeline.
This acquisition marks another significant step towards achieving our ambitions in Injectables, adding a large portfolio of 84 products, which combined with Hikma’s 63 existing marketed products, creates the broadest portfolio of generic injectable products in the US market.-TradeArabia News Service