Columbia Labs buys into pharma outsourcing market
pharmafile | September 16, 2013 | News story | Manufacturing and Production | Actavis, Columbia Labs, Onyx
Columbia Laboratories has agreed a $25 million deal to acquire formulation and manufacturing specialist Molecular Profiles of the UK.
The acquisition will give Columbia Labs an immediate entry into the pharma contract services market as it recovers from a knockback last year involving the delayed approval of an Actavis-partnered progesterone vaginal gel product for high-risk pregnancies in the US, which led to the laying off of around 40% of its workforce.
Since then, investors have been clamouring for details of a new strategic plan for Columbia, which has been saying for some time it would use its $31 million cash reserves to fund an acquisition that – in the words of chief executive Frank Condella – would “transform Columbia over the next three to five years”.
The Molecular Profiles deal includes almost $17 million in upfront cash and more than a million shares of Columbia common stock. All told the purchase price is more than ten times the UK company’s expected earnings before interest depreciation, taxes and amortisation (EBITDA) for the fiscal year ending July 31 next year.
The deal has been unanimously approved by both boards of directors and Molecular Profiles’ shareholders. As part of the acquisition, Molecular Profiles’ chief executive and co-founder Nikin Patel will join the US company’s board of directors.
Condella said the agreement would result in a “broadening [of] our technical expertise with a management team that is well-recognised in the field of pharmaceutical development and analytical services”, while Patel said the deal would enhance Molecular Profiles’ presence in the US.
The Boston-based company will gain an immediate benefit for its biggest commercial product Crinone (progesterone gel), which is sold by Merck Serono, as it will transfer quality and technical support operations to the UK company.
Molecular Profiles is based in Nottingham, “within close proximity of our Crinone manufacturing sites and supply chain management in Europe”, said Condella.
In July, Molecular Profiles opened a new £9 million, 30,000 sq. ft. clinical manufacturing facility in Nottingham to handle a range of non-sterile dosage forms such as solids, liquids, semi-solids and inhaled products.
The investment added six GMP suites, new laboratories and a dedicated clinical packing area to support Phase I and II clinical trial projects.
Molecular Profiles also has a longstanding strategic alliance with Onyx Scientific, which is aimed at delivering end-to-end pharmaceutical development services from initial drug discovery through to the later phases of clinical development.
Phil Taylor
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