The $680 million transaction, announced on August 26, involves the sale of established brands such as Keppra, Vimpat, Neupro, Zyrtec, and Xyzal, along with UCB's Zhuhai manufacturing site, to CBC Group and Mubadala Investment Company. This deal marks a pivotal moment in UCB’s evolution, as the company shifts its focus towards innovation and strategic partnerships in China, one of the world's most dynamic pharmaceutical markets.
The divested portfolio comprises well-established medications that have long delivered value to patients in China. Despite their success, UCB has chosen to pivot towards launching novel treatments in immunology, neurology, and rare diseases, areas where the company sees significant potential for growth and unmet medical needs. This strategic shift aligns with UCB's broader vision of fostering innovation and sustaining long-term growth, supported by its robust late-stage pipeline of new product launches globally.
"In the short term, UCB is exploring the launch of novel medicines in immunology, neurology, and rare diseases in China," said Jean-Christophe Tellier, CEO at UCB. "Our dedication to serving patients with unmet needs in China remains steadfast. Building on our 28-year presence in the country, we are committed to driving patient outcomes through continued collaboration with local partners and fostering innovation.”
The deal is not only a strategic divestment but also an opportunity to ensure that UCB’s legacy products continue to thrive under new ownership. CBC Group, Asia’s largest healthcare-focused asset management firm, and Mubadala, a major investment company from Abu Dhabi, are both well-positioned to drive the future growth of UCB's former portfolio. The expertise and resources of these companies will likely enhance the availability and efficiency of these treatments, benefiting patients across China.
Fu Wei, CEO of CBC Group, said: “The demand for central nervous system (CNS) products in China has been increasing over the past decade, and by leveraging CBC’s unique investor-operator approach, we are excited to channel our expertise, resources and platform synergies to meet these evolving needs and drive value for our stakeholders.”
The transaction includes UCB’s neurology products, along with the Zhuhai manufacturing site. The divestment allows UCB to channel its resources into innovation, ensuring its strategic goals align with the rapidly evolving Chinese market. The combined net sales for these medicines in China totaled €131 million in 2023, illustrating their significant market presence.
While the transaction is still subject to customary closing conditions, including anti-trust clearances, it is expected to finalize by Q4 2024. UCB has assured that this deal will not affect its financial guidance for 2024. However, a slight dilution of the adjusted EBITDA margin is anticipated for 2025, reflecting the company's continued investment in its strategic priorities.
The deal was facilitated by Lazard, UCB’s financial advisor, and Freshfields Bruckhaus Deringer as legal advisor. CBC Group and Mubadala were advised by PJT Partners and Clifford Chance, respectively.
This divestment marks a new chapter for UCB in China, emphasizing the company’s commitment to innovation and strategic partnerships as it adapts to the future demands of the pharmaceutical industry.
