Contract player Recipharm has been on a buying spree that now takes it into India to expand its reach in sterile injectables, one of the hot areas these days for both drugmakers and contractors.
The Swedish CMO today said it would pay 872 million Swedish krona ($105.2 million) to buy from the Sobti family a 74% stake in their sterile injectables CMO, Nitin Lifesciences. The Sobtis will keep the remaining stake, and the partners say they intend to grow in the Indian sterile CDMO market and beyond. Recipharm projects that the combined organization will have annual revenue of SEK 3.5 billion ($423.3 million). The deal is expected to close in Q1 2016.
"The Indian market is particularly attractive showing high growth levels and the transaction firmly establishes Recipharm's emerging market strategy," Recipharm CEO Thomas Eldered said in a statement. "Nitin can also be used as a platform for entry into other regions."
Nitin, which was formed in 1994, has its headquarters in Karnal in Northern India and three plants in Karnal and in Paonta Sahib, including one that was opened last year. It has become a key player in the small-volume parenteral market, Recipharm said.
|Recipharm CEO Thomas Eldered|
The contract manufacturing market has been going through consolidation and Recipharm has been in the midst of that, picking up smaller operators around the world to extend its global reach and its expertise. In the last 18 months, it has acquired operations in France, Portugal and Italy.
With a host of early biologics drugs facing patent losses and with drugmakers turning out more biologic drugs, the sterile injectables market is one of the growth areas of manufacturing, spawning deals large and small. Big Pharma player Pfizer ($PFE) in September completed the $15 billion buyout of Hospira, the largest maker of generic sterile injectable drugs after last year buying New Jersey-based InnoPharma, which specialized in really tricky sterile injectables.
On a much smaller scale, Par Pharmaceuticals paid $490 million last year to pick up JHP Pharmaceuticals, and Jordan-based Hikma picked up Bedford Laboratories, the generic injectable drug unit of Boehringer Ingelheim, for $300 million, to build on its own established sterile injectable business.
- here's the release