Piramal to acquire US-based pharma firm Ash Stevens for up to $53 mn

Billionaire Ajay Piramal-led Piramal Enterprises Ltd has agreed to acquire US-based Ash Stevens Inc. for up to $52.95 million (Rs 355 crore) in an all-cash deal that will boost its high-potency drug development business.

The amount includes $10 million to be paid over the next six months if Ash Stevens meets certain operating profit targets, the Indian company said in a stock-exchange filing on Tuesday. It didn’t specify the targets.

This is the second acquisition by Piramal Enterprises of a contract development and manufacturing organization, or CDMO in industry parlance. The Indian company had in January 2015 purchased Coldstream, a UK-based company that develops and makes sterile injectables, for $30 million.  

Ash Stevens makes difficult-to-manufacture high-potency active pharmaceuticals ingredients, or bulk drugs, including high-potency anti-cancer agents. 

High-potency bulk drugs is one of the fastest-growing segments in the pharmaceutical sector and more than 50% of these products are anti-cancer drugs, said Vivek Sharma, CEO of Piramal’s pharmaceutical solutions business.

The transaction is likely to be completed by the end of this month and is not subject to any regulatory approvals.

Michigan-headquartered Ash Stevens had revenue of $18.3 million in the 12 months ended on 30 September 2015. It has 12 approvals from the US Food and Drug Administration for innovator small molecule bulk drugs and has a pipeline of development products.

Piramal has been making a string of acquisitions to expand. In May, it acquired four brands from Pfizer Inc.

In December 2015, Piramal acquired over-the-counter brands Naturolax, Lactobacil and Farizym in the gastro-intestinal segment from Merck for Rs 92 crore.

In the non-pharmaceuticals segment, Piramal’s US database and consulting services subsidiary Decision Resources Group acquired Adaptive Software LLC and its unit AdaptiveRx for up to $24.5 million in March. Piramal had acquired Decision Resources for Rs 3,400 crore in 2012.

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