Hikma Pharmaceuticals Plc said it would buy German drugmaker Boehringer Ingelheim’s U.S. specialty generic drugs (Roxane) business for about $2.65 billion. Hikma’s new acquisition follows from its purchase of Boehringer’s U.S. generic injectable drugs business and manufacturing operations in Ohio last year.The United States accounted for more than half of Hikma’s 2014 revenue. The generics division is its smallest, accounting for about 15 percent of revenue.
Roxane is a well-established US specialty generics company that was founded in 1885 as The Columbus Pharmaceutical Company. The business was purchased by Boehringer in 1978 at which point its name was changed to Roxane Laboratories, Inc.
- Transforms Hikma’s position in the US generics market, establishing Hikma as the sixth largest company by revenue
- Adds significant breadth to Hikma’s US portfolio, bringing 88 highly differentiated products in specialised and niche segments of the market, including oncology, respiratory, extended release and controlled substances
- Enhances Hikma’s pipeline adding 89 R&D projects, including 57 Paragraph IV products, 13 of which are first-to-file opportunities
- Creates sustainable long-term growth potential, adding Roxane’s highly experienced R&D team with a successful track record of bringing new and differentiated products to market
- Adds a best-in-class manufacturing facility with technologically complex formulation and alternative dosage form capabilities, including modified release solid orals and high potency formulations
- Boehringer’s approximate 16.71% equity stake reflects a shared conviction in the future growth potential of the Hikma Group and allows Boehringer to focus on growing its global core businesses
Background to and reasons for the acquisition
Hikma’s longstanding strategy has been, and remains, to deliver high quality, affordable generic and branded generic medicines to patients through the Company’s position as a leading global injectables manufacturer, a leading pharmaceutical manufacturer in MENA and emerging markets and a high quality provider of generics in the US.
In recent years, Hikma has rapidly expanded its presence in the US generics market. Hikma is now a leading player in the US generic injectables market, reflecting strong organic growth and the successful acquisition and integration of the MSI and Bedford Laboratories businesses. Hikma has also been investing in the development of its non-injectables business in the US, with a focus on expanding its capabilities in specialised and niche segments of the market. The Board believes that the acquisition is a transformational step in delivering Hikma’s commitment to strengthen its non-injectable business in the US.