Transfer of GSK plant to Aspen Pharmacare will wait until midyear

GlaxoSmithKline ($GSK) says its $1.1 billion deal to sell its older heart medicines Arixtra and Fraxiparine to Aspen Pharmacare has been completed. The South African drugmaker took control of most of the commercial operations for those products Wednesday, but it will be midyear before it takes control of a GSK manufacturing site in France to produce them.

Aspen last year struck the deal to buy the drugs and take on the plant in Notre-Dame-de-Bondeville, as part of a major expansion effort by the generic drugmaker to increase its product line and international presence. The plant in France has about 1,000 employees. At about the same time, Aspen announced another $1 billion deal to buy 11 products from Merck ($MRK), known as MSD outside of the U.S. That acquisition, which is also slated to be complete by midyear, includes an API facility in the U.S., along with one API facility and parts of two others in the Netherlands.

There is, in fact, a connection between the two deals. The Merck API business manufactures heparin, the API used in Fraxiparine. The API operation also manufactures the active ingredients for a number of the drugs it intends to buy from Merck. Aspen will have a 10-year contract to continue to manufacture some APIs for Merck and said it intends to drive down costs in the business to be more competitive.

The South African drugmaker is also expanding its existing manufacturing footprint. In September, it reported construction on a new facility that will house a containment suite on a site next to its main manufacturing facility in Port Elizabeth, South Africa. It also is upgrading packaging operations at the complex where it has a facility making oral solid dose meds, one making sterile drugs and a general facility making a variety of products. It said it additionally is making upgrades to manufacturing facilities in East London and Clayville in South Africa.

- here's the release