Solutia opts to retain pharma business

Solutia has elected to retain its Pharmaceutical Services Division
(PSD) despite suggestions that a spin out or sale of the business
were being considered, reports Phil Taylor.

PSD is made up of two Switzerland-based companies - CarboGen and Amcis - and together these companies account for about 2 per cent of Solutia's annual sales with turnover of around $50m. The fact that the companies have been presenting themselves as CarboGen and Amcis rather than Solutia PSD at recent exhibitions - including last year's CPhI and Informex - contributed to speculation that a sale could be on the cards.

Last August, Solutia hired Rothschild to explore its options with PSD"CarboGen and AMCIS are a small but profitable part of Solutia's portfolio," said Jeffry Quinn, president and CEO of the US headquarteed company. We we concluded that we can maximize value for our stakeholders by continuing to own and operate this business."

Solutia filed for Chapter 11 bankruptcy protection in December 2003, and implemented a major reorganisation to drag itself out of its financial difficulties. Solutia Europe, however, has been insulated from the woes affecting its parent after restructuring its finances, giving it breathing space while Solutia in the US and its domestic subsidiaries reorganise.

Solutia's recent investments in CarboGen and AMCIS include the December 2004 completion of a development and manufacturing facility for highly potent active pharmaceutical ingredients (APIs), said Quinn. Other recent investments include the addition of two, 2500-liter reactors at the Bubendorf site in December 2004, as well as new labs and a pilot plant for the production of highly potent APIs.

The Pharmaceutical Services Division was established in 2000 following the acquisitions of CarboGen and AMCIS, and was bolstered in 2002 by the additions of Axio Research and Pharmaceutical Advisors.

Carbogen provides process research, analytical services and active pharmaceutical ingredient (API) synthesis, while AMCIS focuses on process development and larger-scale API manufacture. Meanwhile, Axio specialises in data management, quality control and statistical analysis and Pharmaceutical Advisors brings drug development expertise to the business.