Hospira to buy Orchid's generic injectable pharmaceuticals business
Hospira, a US producer of generic injectable pharmaceuticals, is to acquire the dosage forms business of Orchid Chemicals & Pharmaceuticals for US$400m in a deal that will give the company a direct presence in India and provide a platform for future growth.
Hospira, a US producer of generic injectable pharmaceuticals, is to acquire the dosage forms business of Orchid Chemicals & Pharmaceuticals for US$400m in a deal that will give the company a direct presence in India and provide a platform for future growth.
The agreement includes the acquisition of the Indian firm's beta-lactam antibiotics manufacturing complex (comprising cephalosporin, penicillin and carbapenem facilities) and pharmaceutical research and development facility at Irungattukottai, Chennai, India, as well as its generic injectable product portfolio and pipeline.
The companies have also signed a 10-year exclusive agreement for Orchid to supply active pharmaceutical ingredients (APIs) for the business Hospira is acquiring. This agreement builds on an existing product development and commercialisation relationship between Hospira and Orchid signed in 2005.
Hospira acquires a US FDA approved manufacturing site, the associated r&d facility and approximately 450 employees.
"This acquisition aligns perfectly with Hospira's strategy to improve our margins and cash flow, by lowering our cost position for a key product line, and to invest for growth, by expanding our presence globally and reinforcing our leadership position in generic injectables," said Terry Kearney, Hospira's chief operating officer.
"This transaction will provide Orchid with the financial flexibility to pursue new growth opportunities, and build upon our successful track record of value creation for our shareholders," added Raghavendra Rao, managing director of Orchid.
Assuming all necessary approvals are secured, the transaction is expected to be completed in the first quarter of 2010.
