Through the acquisition, Hikma will benefit from Custopharm’s 13 regulatory approved products, R&D professionals and a laboratory in California
Hikma agrees to acquire Custopharm. (Credit: Triggermouse from Pixabay.)
Hikma Pharmaceuticals has agreed to acquire generic sterile injectables company Custopharm from capital market firm Water Street Healthcare Partners.
Under the terms of the deal, the injectable generic medicines company will pay an initial consideration of $375m, on a debt and cash-free basis.
The company is expected to make an additional payment of $50m, contingent on achieving certain commercial milestones in future.
With a differentiated product portfolio and R&D pipeline, Custopharm is currently commercialising its products in the US through its unit Leucadia Pharmaceuticals.
Custopharm and Leucadia CEO William C Larkins said: “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.”
The California-based company has obtained 13 US Food and Drug Administration (FDA) approvals since it has teamed up with Water Street in 2015.
With the acquisition, its 13 regulatory approved products and additional pipeline products will be added to Hikma’s injectable product portfolio.
Also, Hikma will benefit from an experienced scientific team of R&D professionals experienced in complex sterile injectable products, and an R&D laboratory in California
The company intends to fund the up-front transaction consideration of $375m through its existing cash resources. The deal is subject to US Federal Trade Commission approval.
Hikma aims to generate more than $80m in revenue for full-year 2021, and the acquisition to be accretive to its Injectables operating margin.
Hikma Injectables president Riad Mishlawi said: “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.”