Wisconsin-based Cedarburg is a contract developer and manufacturer of technically complex active pharmaceutical ingredients (APIs) for both generic and branded customers. Cedarburg will expand AMRI’s offering of generic APIs, particularly complex APIs, AMRI CEO and president William Marth said in a conference call on Monday.
Cedarburg’s core capabilities include controlled substances, steroids, prostaglandins, vitamin D analogs, conjugation chemistry and inorganics for the analgesic, ophthalmology and oncology therapeutic areas. Cedarburg has provided API development and manufacturing support for 13 approved products.
“We are very excited to be joining efforts with Cedarburg as they bring a unique blend of expertise in complex API, a scalable business infrastructure and extensive customer relationships that will augment our existing capabilities and services,” said William Marth, AMRI’s president and CEO.
Marth added that the API market is growing at about 10% per year, and Cedarburg’s sustainable infrastructure will allow for future growth as the company can manufacture for clinical trials or commercialization. AMRI also gains new customers – extensive and long-standing relationships that will broaden AMRI’s reach, Marth said.
With little overlap between the companies, the integration will be quick and efficient, Marth added. The acquisition will add to AMRI’s API expansion on scale and capability to capture greater market share, Marth said.
Cedarburg Pharmaceuticals has expertise in developing technically differentiated APIs, and is developing a pipeline including multiple late stage products.
On a stand-alone basis, Cedarburg’s forecasted full year 2014 revenue is approximately $19 million, implying a purchase price multiple of approximately two times 2014 revenue.
The transaction is expected to close in early April 2014. Based on the anticipated timing of the close, the acquisition is expected to add between $13m and $14m to AMRI’s revenue in 2014.
Cedarburg is expected to continue to operate independently within AMRI’s API business unit. Chuck Boland, currently co-founder and EVP of business development will lead the Cedarburg team and report to George Svokos, AMRI’s senior vice president sales and general manager - API.