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GEN News Highlights : Oct 29, 2010
Hikma Buys Baxter’s Injectable Generics Business and Facilities for $112M in Cash
Firm claims acquisition will double size of its global injectables business and related U.S. sales.!--h2>
Hikma Pharmaceuticals is buying Baxter’s U.S. injectable generics business and related facilities for $112 million in cash. Hikma claims the acquisition will add about $180 million in revenues to its existing global injectables portfolio and make the firm the second largest injectables supplier in the U.S., with a combined market share of over 15%. Baxter says selling off the business will allow it to focus on differentiated product offerings derived from its formulation technologies and enhanced packaging expertise.
The acquired injectable generics business comprises a portfolio of about 41 products in different dosage strengths across 23 therapeutic areas and includes several DEA-controlled substances. The deal includes Baxter’s Cherry Hill manufacturing facility in New Jersey, and its warehouse and distribution center in Memphis. Both of these sites are approved for the manufacturing and/or handling of DEA-controlled substances. About 750 employees will also be transferred to Hikma. The acquired business will be rolled into Hikma’s wholly owned U.S. subsidiary, West-Ward Pharmaceuticals.
The acquired products are primarily sold across the U.S., but Hikma says it will be looking at opportunities to introduce the acquired product portfolio in Europe and across the MENA (Middle East and North Africa) region. “The acquisition of Baxter’s multisource injectables business is transformational,” claims Said Darwazah, Hikma CEO. "The acquisition doubles the size of our global injectables business and doubles our sales in the U.S. market, while further diversifying our global revenue base. Importantly, we still retain sufficient financial flexibility to acquire additional assets across our core businesses and geographies.”
Founded in 1978 in Jordan, Hikma develops, manufactures, and markets a range of branded and non-branded generic and in-licensed products. With the majority of its overall business focused on the MENA region, the firm is organized into three separate pharmaceutical operating units, branded, injectables, and generics.
Prior to its acquisition of the Baxter business, Hikma’s injectables operation marketed 88 branded and nonbranded products in 215 dosage strengths and forms, including seven in-licensed products. The firm has particular strengths in anti-infectives, and more specifically injectable cephalosporins. In the first half of 2010 Hikma‘s injectables business recorded sales of $74.5 million, up 10% on the same period in 2009. 40% of injectables sales were made in the MENA region, with the U.S. accounting for 17.4% of injectables sales, and the rest of the world including Europe accounting for 42.6%.
Hikma’s largest business unit is branded pharmaceuticals, which includes 241 solid, semi-solid, and liquid products in 472 dosage strengths and forms. While its branded products are currently centered on anti-infectives, Hikma says it expanding further into the cardiovascular, CNS, and diabetes therapeutic areas.
The company’s generics business is embodied in its New-Jersey-based West-Ward business, which sells 49 generic compounds in 108 dosage forms and strengths for a range of therapeutic areas. Business development at West-Ward is four-pronged: acquiring ANDAs (Abbreviated New Drug Applications) and NDAs (New Drug Applications); acquiring "limited competition generics" development capabilities; acquiring licenses in authorized generics to enable the sale of generics under their original patents; and generic company acquisitions.
Hikma reported overall global net sales of $357.7 million in the first half of 2010, up 11.3% on the same period in 2009. Sales of its branded products for the first half of 2010 were $193.8 million, up nearly 2%. Sales of generics increased 41% to $87.2 million. It claims to be the fifth top player in terms of pharmaceutical sales in the nine major MENA region markets combined, behind sanofi-aventis, GlaxoSmithKline, Pfizer, and Novartis.
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