AMRI Acquires Cedarburg Pharmaceuticals in $41M Deal
Albany Molecular Research (AMRI) said today it will acquire Cedarburg Pharmaceuticals in a $41 million deal that broadens the acquiring company’s custom and complex drug development services and products for both generic and branded biopharma customers.
Cedarburg is a contract developer and manufacturer of complex API's whose core capabilities include controlled substances, steroids, prostaglandins, vitamin D analogs, conjugation chemistry and inorganics for the analgesic, ophthalmology and oncology therapeutic areas.
Headquartered in Grafton, Wis., Cedarburg has provided API development and manufacturing support for 13 approved products, and built a development pipeline that includes multiple late-stage products—a pipeline the companies said “is expected to be an important contributor for future growth.” Cedarburg is expected to continue to operate independently within AMRI's API business unit.
"This transaction represents an important first step in building out our API capabilities, broadens our offerings and customer base and provides us with an ideal platform to pursue additional value creation opportunities," William S. Marth, AMRI's president and CEO, said in a statement.
Cedarburg’s 2014 revenue has been forecast at about $19 million, with adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) between $5.5 million and $5.7 million. Adjusted EBITDA excludes any deal related costs or purchase accounting impacts.
AMRI will pay $38.2 million cash for Cedarburg, and assume $2.8 million of Cedarburg liabilities, in a deal that is expected to close in early April. As part of the deal, Chuck Boland, currently co-founder and evp of business development, will lead the Cedarburg unit. Boland will report to George Svokos, AMRI's svp, sales and general manager.
Headquartered in Albany, NY, AMRI is a global contract research and manufacturing organization offering customers a series of fully integrated drug discovery, development and manufacturing services that the company calls Smartsourcing™.
AMRI finished last year with $12.7 million in net income on revenues that rose 9% to $246.6 million, compared with a $3.8 million loss on $226.7 million in 2012, reflecting $4.2 million in restructuring charges associated with the restructuring of its global Discovery Services platform. Most of AMRI’s revenue ($210 million) came from contract activity; the rest from royalty revenue from Allegra products and $9 million in net sales of amphetamine salts by Actavis.
With sites in Europe and Asia as well as the U.S., AMRI has successfully partnered R&D programs and says it is actively seeking to outlicense its remaining programs for further development.