Date: 2015-04-24
Type of information: Company acquisition
Acquired company: Idis Group (UK)
Acquiring company: Clinigen (UK)
Amount: £225 million
Terms: * On April 24, 2015, Clinigen Group, the specialty global pharmaceutical company, has agreed to acquire Idis Group Holdings Limited, creating the market leader in the ethical unlicensed supply of medicines. Idis is being acquired for an enterprise value of £225.0 million. In the 12 months ended 28 February 2015, Idis achieved unaudited last 12 months revenues of £196.8 million and adjusted EBITDA of £15.6 million. The Acquisition is expected to be immediately earnings enhancing and significantly enhancing in the first full year of ownership; the level of enhancement is expected to improve further in 2017. Clinigen has identified annual cost synergies from the Acquisition of approximately £2.5 million, and the Board believes that opportunities for further revenue and cost synergies are likely to be identified. The Acquisition and associated expenses will be financed by a fully underwritten vendor placing raising gross proceeds of £135.0 million and by £104.0 million to be drawn down under new debt facilities. Vendor Placing comprises the issue of 27,000,000 new ordinary shares (the “Placing Shares”) at a price of 500 pence per share – a discount of approximately 4.9 per cent. to the closing middle market price of 525.5 pence per ordinary share on 23 April 2015. Completion of the Acquisition is conditional only on the Placing Agreement becoming unconditional (and not being terminated) and upon admission to trading on AIM of the Placing Shares and of the Vendor Shares.
Details: The Clinigen Group is a specialty global pharmaceutical company headquartered in the UK, with offices in the US and Japan. The Group currently employs 119 people. The Group, dedicated to delivering 'the right drug, to the right patient at the right time', has three operating businesses: Specialty Pharmaceuticals (“SP”), Clinical Trials Supply (“CTS”) and Global Access Programs (“GAP”). SP focuses on acquiring and in-licensing specialist, hospital only medicines worldwide and commercialising them within niche markets. CTS sources commercial medical products for use only in clinical studies, including comparator drugs, adjuvant drugs and rescue therapies. GAP specialises in the consultancy, development, management and implementation of programs providing access for patients and their clinicians to drugs not available on a licensed basis in their markets. Idis is the global market leader in providing access to unlicensed medicines in over 100 countries, across a number of therapeutic areas (including oncology, haematology and immunology) and across the product lifecycle. Founded in 1987 and majority owned by CBPE Capital LLP since 2005, Idis currently has 189 employees and is headquartered in Weybridge, Surrey with an office in Princeton, New Jersey, USA. Idis has a comprehensive capability in Managed Access Programs (on an exclusive supply basis) and General Access (on-demand), giving physicians and their patients access to medicines wherever an unmet need exists. Idis has two business divisions, a managed access division, focused on providing access to clinical phase and pre-approved medicines via Managed Access Programs (“MAPs”) (this division is equivalent to Clinigen’s GAP business but includes a clinical trials supply business), and a general access division, focused on providing access to medicines already approved in another market. In the year ended 30 November 2014, Idis’ managed access division shipped some 222,000 product units into a wide range of countries around the world, and the general access division shipped approximately 620,000 units, primarily to the UK and EU. The Directors believe that the Acquisition represents an excellent strategic opportunity for Clinigen to create global market leadership in ethical unlicensed supply, a large addressable and under-penetrated market. As a truly global player, the enlarged Group will have an opportunity to shape and develop a market estimated to be greater than $5.0 billion. The global ethical on-demand unlicensed supply market is estimated to be approximately $2.2 billion in size, where Idis is the leader in the UK hospital market and demand in the rest of the world is typically met by local wholesalers and agents; exclusive managed access programs constitute c.$500 million - $600 million of this c.$2.2 billion market. The general “unethical” unlicensed supply market is estimated at a minimum of $5.0 billion; Clinigen consider that an ethical supply alternative is needed to meet hospital pharmacist and clinician need for a significant proportion of this market, and therefore consider this market to have huge growth potential. Clinigen has identified annual cost synergies from the Acquisition of approximately £2.5 million, and the Directors believe that opportunities for further revenue and cost synergies are likely to be identified post the completion of the Acquisition.
Related: CRO - Technology - Services
