Valeant Pharmaceuticals is to acquire Switzerland-based generics and OTC drug firm PharmaSwiss for €350 million (about $475 million). Some of the latter’s shareholders could receive up to another €30 million (nearly $41 million) dependent on the achievement of certain milestones.
PharmaSwiss is focused on products in the therapeutic areas of heart and circulatory diseases, pain management, anti-infectives, rheumatic diseases, neurological and psychiatric conditions, oncology, and gastroenterology. It has operations in 19 countries throughout Central and Eastern Europe as well as Greece and Israel. The firm also has established partnerships with pharma and biotech companies, through which it provides expertise in fields spanning regulation compliance, sales, marketing, and distribution.
It recorded revenues of approximately €180 million in 2010 (about $245 million) and has witnessed revenue growth of about 20% per year over the last five years. Sales for 2011 are expected to exceed €200 million (roughly $272 million). PharmaSwiss has about €38 million (about $52 million) in cash on hand and carries no debt.
Once the acquisition has been completed, PharmaSwiss’ senior management team will remain with Valeant, and it is expected that at some future point the Valeant business in Central Europe will be combined under the PharmaSwiss corporate structure, which is based in Zug, Switzerland.
Valeant maintains acquiring PharmaSwiss will solidify its positon in Central and Eastern Europe and provides an attractive partnering strategy as well as complementary branded generics and OTC products to help strengthen its presence in the region.
“Valeant’s additional resources, professional approach, focused pipeline, and strong commitment to supporting all three legs of the PharmaSwiss business model—representation of multinationals, licensing from specialty pharma, and own brands—will enable us to build on our winning strategy of serving partners,” adds Pavel Mirovsky, Ph.D., PharmaSwiss CEO. “Valeant Europe’s strong presence in Poland, the region’s largest market, fills an important gap and should contribute to transaction synergies.”