Double acquisition package for AmerisourceBergen
AmerisourceBergen has snapped up Canadian drug distributor Asenda
and British pharmaceutical contract-packaging manufacturer Brecon,
indicating the aggressive strengthening of the firm's portfolio in
the pharmaceutical supply chain.
AmerisourceBergen splashed out approximately $49m (€40m) in cash for Brecon, while the purchase price for Asenda was not disclosed and its acquisition is expected to be completed by the end of March.
Based in Richmond, British Columbia, Asenda made about $172 million in revenue over the last year.
The company distributes pharmaceuticals in the provinces of British Columbia and Alberta, so it will reinforce AmerisourceBergen's position in western Canada.
The Canadian division, AmerisourceBergen Canada, was created when Trent Drugs, one of the largest national pharmaceutical distributors in Canada, was acquired by AmerisourceBergen last October for around $83m.
Now the company is also targeting the contract packaging business in foreign markets so it hopes Brecon's position as a major provider of contract packaging and clinical trial materials services for pharmaceutical manufacturers in the UK will provide it with a solid launching platform.
With 90,000 square feet of packaging space, Brecon provides services to pharmaceutical manufacturers throughout Europe and Asia and in 2005 reported revenues of approximately $22 million.
Under the terms of the acquisition, it will receive a contingent payment of up to $19m based on it achieving specific earnings targets in 2006.
"More and more companies are outsourcing their packaging operations, so it makes sense to try to reach more clients globally and the acquisition of Brecon will allows us to do that," AmerisourceBergen spokesman Michael Kilpatric told In-PharmaTechnologist.com.
"Brecon's facilities in Wales are excellent and also offer the opportunity of expansion if we need to grow there."
In January Brecon completed the doubling in size of its facilities, responding to growing demands from its pharmaceutical customers.
This expansion increased their level of automation, which ultimately has the potential to bring down the unit cost of packaging.
Global demand for pharmaceutical packaging is tipped to increase 6.3 per cent each year to create a $30bn market in 2009, pushed by emerging pharma industries, tighter government standards on packaging and the burgeoning advanced drug delivery sector.
AmerisourceBergen says the purchase of both companies is expected to be neutral to its fiscal 2006 earnings.
