Recipharm has struck a deal with Sanofi to buy the French drugmaker’s contract inhalation drug business and plant in the U.K., picking up new capabilities and clients in the process.
The Swedish CDMO said on Wednesday that it will pay about £45 million ($60.2 million) for the 125,000-square-meter site at Holmes Chapel near Manchester, where Sanofi makes metered-dose inhalers and nasal sprays for contract clients.
The deal is slated to close in the fourth quarter of 2018, at which point Recipharm will add the plant’s 450 employees. Recipharm said the CDMO said the transaction is expected to be accretive to EBITDA-margin and earnings per share beginning in the first quarter of 2019.
“Holmes Chapel brings Recipharm an ideal opportunity to accelerate its offering to customers with access to novel of respiratory products,” Recipharm CEO Thomas Eldered said in a statement. “Treatments for asthma and chronic obstructive pulmonary disease (COPD) are growing at a fast rate and we see many opportunities.”
Sanofi will enter into a long-term supply agreement with Recipharm for some products currently made there. Among the products being made there is Vectura Group’s COPD product Flutiform.
A Sanofi spokesperson Thursday said the decision to close the plant was part of the company's streamlining plan. He also said the drugmaker believes this is best for employees.
"As a specialist pharmaceutical contract manufacturing company, they will have greater opportunities to utilize the technologies and capabilities on site and bring in volumes from a variety of clients, and therefore will provide the best future for the site and for employees," he said.
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Recipharm has been both adding and closing plants in the last year as it looks for new capabilities and geographic reach. In November, the company announced the closure of a tablet plant in the Stockholm area with about 180 workers, as well as a sachet and stick pack filling facility in Höganäs, Sweden, with about 45 workers. The company said it expected to close the Stockholm plant by the end of 2019 and “to have discontinued its involvement in operations” at Höganäs by the end of 2018 at the latest.
Those moves came weeks after Recipharm struck a deal to acquire from Roche a solid-dose products plant in Leganés, Spain, near Madrid, taking on 200 Roche workers in that deal. It also negotiated a long-term manufacturing agreement to supply Roche with a number of solid dose products from the plant.