Mumbai: Global pharmaceutical company Dr Reddy's Laboratories has entered into an agreement to acquire BASF's pharmaceutical contract manufacturing business and related facility in Shreveport, Louisiana, US.
The business involves the contract manufacturing of generic prescription and over-the-counter products for branded and generic companies in the US, Dr Reddy's said in a release without disclosing financial terms and conditions of the transaction.
The acquisition will include the relevant business, customer contracts, related ANDAs and NDAs, trademarks, as well as the manufacturing facility and assets of BASF at Shreveport. It also includes a tolling and supply .agreement. The facility is designed to manufacture solid, semi-solid and liquid dosage forms, Dr Reddy's said.
The company plans to fund the acquisition through internal cash reserves or other committed credit facilities.
The BASF facility currently employs approximately 150 people and has a proven track record of compliance with regulatory authorities including the USFDA.The unit had revenues of $43 million for the year ended 31 December 2007, according to the release.
"The acquisition of BASF's finished dosage manufacturing facility in the US will enable us to strengthen our supply chain for North America and provide a strong platform for pursuing additional growth opportunities," said Satish Reddy, managing director and chief operating officer, Dr Reddy's Laboratories.
The BASF facility would provide Dr Reddy's with a profitable revenue base built on strong customer relationships with branded and generic companies and offer a platform to further expand its portfolio of prescription generics, QTC capabilities and product portfolio, according to Mark Hartman, president, North America Generics, Dr. Reddy's Laboratories.
"We are pleased with Dr. Reddy's decision to acquire BASF's contract manufacturing business and facility at Shreveport, Louisiana and are encouraged by Dr. Reddy's growth-oriented view of the business," said Martin Widmahn, head of BASF's pharma ingredients and services global business unit.
The transaction, which is subject to regulatory approvals and customary closing conditions, is expected to be completed within the first quarter of fiscal year 2008-09.
Hyderabad-based Dr Reddy's Laboratories conducts research in the areas of diabetes, obesity, cardiovascular diseases, anti-infectives, and inflammation. The company produces finished dosage forms, active pharmaceutical ingredients, and biotechnology products which are marketed globally, with a focus on India, US, Europe, and Russia.
BASF, the world's leading chemicals manufacturer, has a product portfolio ranging from oil and gas to chemicals, plastics, performance products, agricultural products and fine chemicals. BASF has more than 95,000 employees worldwide and posted sales of almost €58 billion in 2007.