Piramal Enterprises buys contract drug maker Ash Stevens for $53 million
Mumbai: Piramal Enterprises Ltd on Tuesday said it has bought Ash Stevens Inc., a US-based contract developer and manufacturer of drugs, in an all-cash deal for $43 million (Rs.286 crore) as it seeks to expand its Northern American business.
In addition, Piramal will pay a so-called earnout capped at $10 million (Rs.67 crore)—a payment that depends on the business achieving certain financial goals.
The purchase, made by a unit of Piramal in the US, is expected to be completed by August end.
Located in Michigan, Ash Stevens has more than 50 years of experience in contract manufacturing, and serves several biotech, mid-size pharma, and large pharmaceutical clients worldwide, a note by Piramal said.
Ash Stevens has a record of working with high potency anti-cancer agents and other highly potent therapeutics. Its manufacturing facility in Michigan has approvals from regulators in the US, European Union, Australia, Japan, South Korea and Mexico.
The note described Ash Stevens as one of the leaders in manufacturing high potency active pharmaceutical ingredients (HPAPIs), which go into therapies for treating cancer, diabetes and cardiovascular diseases.
“The acquisition of Ash Stevens fits well with our strategy to build an asset platform that offers value to our partners and collaborators. Currently, around 25% of the molecules in clinical development are potent. Our clients are looking for reliable partners that can assist them in advancing these programmes forward,” said Vivek Sharma, chief executive officer, Piramal Pharma Solutions.
“North America is a key market that we can now service with our three local facilities—the Coldstream Labs in Kentucky for fill finish needs, the Torcan facility in Toronto for complex high value APIs and now, Ash Stevens in Michigan for HPAPIs. Having facilities with a differentiated platform and geographical proximity to clients are key towards building strategic partnerships. We expect this acquisition to also be synergistic with our antibody drug conjugates (ADCs) and injectable business,” Sharma added.
Piramal Enterprises shares rose 7.46% to Rs.1,801.25 at the close of trading on BSE on a day the benchmark Sensex gained 0.31% to 28,064.61 points.
“With its rich history of scientific excellence and a track record of 12 product launches, Ash Stevens is well poised to become the partner of choice for clients looking to advance programmes from early development through launch,” said Mark Cassidy, president of the API Business at Piramal Pharma Solutions.