Ben Venue to Sell Assets of Bedford Laboratories to Hikma Pharmaceuticals

Ben Venue Laboratories. Inc., a member of the Boehringer Ingelheim Group of Companies, has signed an asset-purchase agreement for the sale of the assets of Bedford Laboratories, Ben Venue's US injectable generics business, to Hikma Pharmaceuticals PLC, a London-based pharmaceutical company involved in developing, manufacturing, and marketing branded and non-branded generic and in-licensed products. Hikma will acquire assets of Bedford Laboratories for a total consideration of up to $300 million, which includes an upfront cash payment of $225 million and a further $75 million in contingent cash payments, subject to the achievement of performance-related milestones over a period of five years.

Under the agreement, Hikma will be acquiring Bedford Laboratories' assets, including a large product portfolio, intellectual property rights, contracts for products marketed under license, raw material inventories, a R&D and business development pipeline, and a number of employees across key business functions, such as R&D, sales and marketing, business development, and regulatory affairs. In addition, Hikma has entered into an exclusivity arrangement with the Boehringer Ingelheim to potentially acquire substantially all of the assets of the Ben Venue manufacturing facility in Bedford, Ohio, subject to due diligence and customary approvals in the US and the UK.

In 2013, Hikma's global Injectables business generated revenue of $536 million and accounted for 39% of the company’s revenues, and it has been an area of recent investment by the company. In May 2011, the company completed the acquisition of Baxter's multi-source Injectables business, which grew its US Injectables business, making Hikma the third largest supplier by volume in the US generic injectables market, according to the company. The company estimates the global generic injectables market at $12 billion and the US market at $7.6 billion. The pending acquisition of Bedford Laboratories would add 84 products to Hikma’s injectables portfolio, which now includes 63 marketed products. Bedford's portfolio covers a range of therapeutic categories and includes a large number of oncology products, as well as a number of niche, differentiated products. Bedford’s R&D pipeline includes 27 products, of which 16 are filed and pending approval from FDA.

Hikma said it will use its manufacturing facilities in the US, Portugal, and Germany to manufacture the acquired products, which it will begin transferring to Hikma's sites following closing the transaction. The company said it is targeting to transfer initially  20 products, which it expect to be able re-launch to the market between 2015 and 2017, with the potential to transfer further products thereafter. The products will be prioritized based on the strength of the market need, the ease of transfer, and the expected gross margin contribution.

Source: Ben Venue and Hikma Pharmaceuticals

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