Recipharm to buy Kemwell's API and formulations business for SEK1.7bn
The deals – which are expected to close this quarter – will add Kemwell’s operations in Sweden, the US and India to Recipharm’s network.
Recipharm will pay Kemwell’s owner - Kemfin Holdings Private – SEK693m ($85m) for its operations in Sweden and the US.
In addition, Recipharm will pay SEK982m to Kemwell’s founder – the Bagaria family – for the Indian arm of the business.
The Swedish firm said the deals will give it greater access to US customers and the opportunity to offer reduced cost manufacturing through Kemwell’s operation in India.
CEO Thomas Eldered said "We now have a US footprint which we can use to further penetrate the world’s largest pharmaceutical market and the business in Sweden provides us with several opportunities for synergies.
"When we receive the approval in India, Recipharm’s customers will have access to very cost effective development and manufacturing capabilities able to serve international markets including the US."
Recipharm recently bought a 74% stake in India-based Nitin Lifesciences.
Eldered also confirmed the deals will strengthen the CMO's relationship with Pfizer, which is main customer supplied by one of the Kemwell facilities in Sweden.
He told analysts the facility provides Pfizer with “a fairly limited product range, but the volume in this product range is very high…This product has been off patent for several years but Pfizer has been able to maintain a strong presence in the market.”
Operations
Kemwell’s US drug development operation is based in Research Triangle Park, North Carolina. The unit employs 50 staff and provides 120 customers with development for inhalable drugs, liquid, semi-solid, solid and parenteral products.
In Sweden, Kemwell has a 210 strong team at its two production units in Uppsala. The operations manufacture and formulate active pharmaceutical ingredients (APIs). One of the production units was previously owned by Pfizer, which sold it to Kemwell in 2006.
Kemwell’s Indian business employs 1,400 people and provides development services as well as commercial manufacturing of solid, semi-solid, liquid and topical dose products.
