TIDMHIK
RNS Number : 9861M
Hikma Pharmaceuticals Plc
27 September 2021
This announcement contains inside information
London, 27 September 2021 - Hikma Pharmaceuticals PLC (Hikma),
the multinational pharmaceutical company and one of the largest
suppliers of generic injectable medicines in the US, today
announces that it has agreed to acquire Custopharm Inc.
('Custopharm') from Water Street Healthcare Partners ('Water
Street').
Hikma will pay an initial cash consideration of $375 million on
a debt and cash-free basis, with a further $50 million in
contingent consideration payable upon the achievement of certain
commercial milestones.
Custopharm, a US-based generic sterile injectables company with
a differentiated product portfolio and R&D pipeline, currently
markets its products in the US through its commercial arm Leucadia
Pharmaceuticals. Since partnering with Water Street in 2015,
Custopharm has received 13 US FDA approvals, with four
first-to-market Abbreviated New Drug Application (ANDA) approvals -
including one with Competitive Generic Therapy (CGT) designation -
and one novel 505(b)(2) NDA approval. Based in Carlsbad,
California, Custopharm has 39 employees.
Transaction highlights and strategic rationale:
-- Complements Hikma's injectable product portfolio and pipeline
, adding 13 approved products and additional pipeline products
-- Enhances Hikma's R&D capabilities , adding an experienced
scientific team of dedicated R&D professionals with a proven
ability to develop and commercialise complex sterile injectable
products and a state-of-the-art R&D laboratory in
California
-- Maintains Hikma's strong regulatory track record . Custopharm
has consistently obtained regulatory approval for new products with
four first-to-market FDA ANDA approvals, including one CGT
exclusivity for Calcitonin Salmon, which was launched in May
2021
-- Strengthens Hikma's platform for future growth. Custopharm is
a growing business and Hikma expects it to generate full year 2021
revenue in excess of $80 million and for the acquisition to be
accretive to Hikma's Injectables operating margin
Siggi Olafsson, Chief Executive Officer of Hikma, commented:
"This acquisition provides Hikma with an attractive opportunity
to further strengthen our US injectables business, by adding an
attractive and profitable portfolio of marketed products and an
exciting pipeline of future opportunities. Custopharm is an
accomplished operator in the US injectables market with a
first-class scientific team and a strong regulatory track record.
This acquisition is highly complementary to our existing business
and adds high-quality and differentiated growth potential."
Riad Mishlawi, President of Hikma Injectables, commented:
"With this acquisition, Hikma will have a differentiated US
portfolio of close to 130 injectable medicines - a more than
fivefold increase over the last decade. Through this broad
portfolio and by combining Custopharm's strong R&D capabilities
with our high-quality and extensive manufacturing footprint, we
will be in an excellent position to better serve the growing needs
of hospitals, doctors and patients. I look forward to welcoming the
team at Custopharm and Leucadia to Hikma as we continue to grow and
strengthen our Injectables business."
William C. Larkins, Ph.D., CEO of Custopharm and Leucadia,
added:
"We're excited to become part of Hikma, a global leader that
shares our deep commitment to bringing generic products to market
and into the hands of patients who need them. Water Street has been
an outstanding partner in working with us to build an exemplary
portfolio of complex generic products. We're looking forward to
building on this success."
Terms of the transaction and financial impact
The up-front consideration of $375 million is on a cash-free,
debt-free basis and is being funded from Hikma's existing cash
resources.
The acquisition constitutes a Class 2 transaction pursuant to
the UK Listing Rules. The gross assets of Custopharm at 31 December
2020 were $43 million. Losses before tax in the year to 31 December
2020 were $7.5 million.
The transaction is subject to US Federal Trade Commission
approval.
- ENDS -
The person responsible for the release of this announcement on
behalf of Hikma is Peter Speirs (Company Secretary).
Enquiries:
Hikma (Investors):
Susan Ringdal
EVP, Strategic Planning and Global +44 (0)20 7399 2760/ +44 (0)7776
Affairs 477050
Guy Featherstone +44 (0)20 3892 4389/ +44 (0)7795
Senior Investor Relations Manager 896738
Layan Kalisse +44 (0)20 7399 2788/ +44 (0)7970
Investor Relations Analyst 709912
Teneo (Press):
+44 (0)7703 330 269/ +44 (0)7385
395 028
Charles Armitstead / Claire Scicluna
US Media
Steven Weiss/David Belian +1 732 788 8279/ +1 848 254 4875
About Hikma
(LSE: HIK) (NASDAQ Dubai: HIK) (OTC: HKMPY) (rated BBB-/stable
S&P and BBB-/stable Fitch)
Hikma helps put better health within reach every day for
millions of people around the world. For more than 40 years, we've
been creating high-quality medicines and making them accessible to
the people who need them. Headquartered in the UK, we are a global
company with a local presence across the United States (US), the
Middle East and North Africa (MENA) and Europe, and we use our
unique insight and expertise to transform cutting-edge science into
innovative solutions that transform people's lives. We're committed
to our customers, and the people they care for, and by thinking
creatively and acting practically, we provide them with a broad
range of branded and non-branded generic medicines. Together, our
8,600 colleagues are helping to shape a healthier world that
enriches all our communities. We are a leading licensing partner,
and through our venture capital arm, are helping bring innovative
health technologies to people around the world. For more
information, please visit: www.hikma.com
About Custopharm
Custopharm is a leader in the generic injectables market. Its
goal is to provide important new generic injectable products to the
acute and specialty markets and to reach people and communities
with underserved conditions. Custopharm invests significantly in
developing and acquiring new products, including through strategic
partnerships. It also launches newly approved products through its
nationally recognized commercial organization, Leucadia
Pharmaceuticals. Custopharm features a portfolio of highly
differentiated generic products, including four first-to-market
products: Calcitonin Salmon Injection, USP, Synthetic,
Dihydroergotamine Mesylate Nasal Spray, Sodium Tetradecyl Sulfate
(STS) Injection, 3%, and Valrubicin Intravesical Solution, USP.
Headquartered in Carlsbad, California, Custopharm is a company of
Water Street Healthcare Partners, a strategic investor focused
exclusively on the health care industry.
About Water Street
Water Street is a strategic investor focused exclusively on
health care. The firm has a strong record of building
market-leading companies across key growth sectors in health care.
It has worked with some of the world's leading companies on its
investments including Humana, Johnson & Johnson, Medtronic and
Walgreen Co. Water Street's team is comprised of industry
executives and investment professionals with decades of experience
investing in and operating global health care businesses. The firm
is headquartered in Chicago.
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