Recipharm has been building its capabilities in sterile injectable and inhalation drugs. Now it is buying a CDMO that manufactures devices for both of those.
The Swedish CDMO today said (PDF) it has struck a deal to pay £10.10 pounds a share, or about £505 million ($649 million) for Consort Medical. The U.K.-based CDMO’s Bespak division manufacturers delivery devices for respiratory, nasal, injectables and ocular products and its Aesica division provides development and manufacturing of APIs and finished dose products.
The deal, which Recipharm says will boost its revenues to pro forma kr 10.847 billion ($1.1 billion), is slated to close in Q1 2020, at which time Recipharm will take over Consort Medical’s 2,000 employees and 10 manufacturing sites. The CDMO has sites in King’s Lynn, Cambridge, Nelson, Milton Keynes, Cramlington, Queenborough and Hemel Hempstead in the U.K.; sites in Monheim and Zwickau, Germany and one in Pianezza, Italy.
"Recipharm’s aim is to become a leading global CDMO and it is successfully executing against its ambitious growth strategy, targeting annual sales of over SEK 8 billion by 2020,” Recipharm said in a statement. “This target has been set amid consolidation in the fragmented CDMO industry, as pharmaceutical companies seek to reduce their fixed costs by rationalizing supply chains and focusing on core R&D and sales capabilities.”
Recipharm has spent the last several years extending its reach and capabilities. Last year it snapped up Sanofi’s contract inhalation drug business and plant in the U.K., for £45 million ($60.2 million). That deal gave the Sweden company a 125,000-square-meter site at Holmes Chapel near Manchester, that makes metered-dose inhalers and nasal sprays for contract clients. It also added about 425 employees to Receipharm.
It earlier beefed up its sterile injectable business with the $105.2 million buyout of Nitin Lifesciences, an Indian sterile injectables CMO with three manufacturing sites.
Consort did much of the same, buying U.K. CMO Aesica for £230 million in 2014 and then investing in Precision Ocular in 2016.
When the Consort Medical deal is complete, Recipharm says it will rank among the top five CDMOs.