Recipharm's Recipe For Success: Acquires Corvette Pharmaceutical

Recipharm's Recipe For Success: Acquires Corvette Pharmaceutical
Recipharm which is a contract development and manufacturing company has announced its acquisition of Italian pharma giant Corvette for around SEK 1.1 billion or around 120 billion Euro. As per the agreement, Recipharm will purchase Corvette from an Italian private equity group called LBO Italia Investimenti. Around 50% of the payment will be made by cash whereas another 50% will be made through the medium of convertible bond.

Corvette Pharmaceuticals Services Group currently has 3 manufacturing facilities in Milan which is in Northern Italy. One of the sites at Masate specialised in sterile injectibles while the facility at Lainate focuses on bulk lyophilisation of sterile antibiotics. Paderno Dugnano is the final site and it is responsible for the development and manufacture of finished dose forms. Around 256 people are employed by the 3 facilities which serve around 100 clients. This includes global generic firms as well as mid-size pharma companies.

The acquisition of Corvette is set to rev up Recipharm's growth engine. The CEO of Recipharm, Thomas Eldered has indicated that the acquisition is oriented towards enhancing Recipharm's strategic expansion. He has been quoted as saying “We will be gaining access to a first class and largely new customer base as well as new capabilities and capacities that will add to our technology base… We are therefore looking forward to combining the assets of both organizations and working together with the management of Corvette to deliver benefit to all of our stakeholders.”

With this pharma acquisition, Recipharm is looking to expand into emerging markets in territories that are new. This includes Italy. With this acquisition completed, Recipharm will now have a massive asset base on the 5 biggest European pharma markets and this is not all. It will set foot on previously unchartered territories through its acquisition.

Recipharm has been cooking up other new plans as well. It has recently signed a partnership with CTC Clinical Trial Consultants for the development and manufacturing of clinical trial material. It has also joined hands with Stockholm-based Pharmanest for the production and manufacture of a gynaecological product called SHACT which can be distributed through the newly acquired target areas.

The transaction with Corvette is going to near completion by October this year. Many top pharma firms are joining the race to collaborate and innovate. Going solo may not leave one flying high. Strategic alliances can work wonders. But even for alliances and acquisitions to work, there has to be cohesion and understanding between the units or organisations.

With pharma companies being acquired partially or completely, larger companies are trying to acquire their know-how and USP for a bigger advantage. Health-care is set for a revolution through strategic acquisitions.