Watson Pharmaceuticals acquired Greece-based generic drugs firm Specifar, for €400 million (about $562 million) in cash and certain contingent consideration. Specifar specializes in the development, production, distribution, and sales of generics. The firm reported revenues of about €85 million in 2010, and currently has about 400 marketing authorizations licensed out to third parties for sale in 36 countries, primarily in Europe. Its pipeline includes eight products currently filed in the EU.
Watson says acquisition of Specifar will enhance its presence in key European markets by providing a portfolio of approved products, and provide a springboard into the €6 billion Greek pharmaceutical market, where the latter’s generics, branded under the Specifar and Alet names, rank in the top five. “Greece’s generic product utilization is currently one of the lowest in Europe, providing us with a significant opportunity to capitalize on growth in this market,” points out Paul Bisaro, Watson’s president and CEO.
The Specifar pipeline includes a generic tablet version of esomeprazole, which the firm projects could launch in some European markets by the end of 2011. Under terms of the acquisition agreement Specifar’s former owners could receive up to an additional €40 million, dependent on profits from sales of the generic esomeprazole during the first five years after launch.
The Greek firm’s current manufacturing facility in Athens has a capacity for about 1 billion doses a year. A new Specifar facility is also currently under construction just outside Athens, and is expected to achieve EU certification by mid-1012. The new plant will provide the capacity for another 3-5 million doses a year. Watson says this overall manufacturing capability will allow it eventually to take on the production of products previously manufactured by third parties.
“The strategic significance of this combination is substantial,” Mr. Bisaro remarks. “Watson will now have a powerful product development capability recognized throughout the industry for its strong track record of successfully launching products in key European markets, supported by an accomplished R&D and regulatory capability. The development business will continue to develop and market products to third parties under the Specifar name and now will also develop products for Watson’s commercial groups worldwide.”