Cambrex to Buy Avista Pharma Solutions
Cambrex Corporation, which bills itself as the leading manufacturer of small molecule innovator and generic Active Pharmaceutical Ingredients (APIs), has agreed to acquire Avista Pharma Solutions, a contract development, manufacturing and testing organization (CDMO), from private equity investor Ampersand Capital Partners for about $252 million.
The deal is set to close in the fourth quarter of this year, subject to all customary conditions. With the buy, Cambrex, based at East Rutherford, New Jersey, will be able to enter early stage small molecule development and testing services. The company expects to fund the acquisition with a combination of cash on hand and borrowings under its existing revolving credit facility, which will be increased through its accordion feature.
Cambrex, which employs 1,700 in the US and Europe, said the acquisition will further strengthen its position as the leading fully integrated small molecule CDMO across the entire drug lifecycle. It will also allow it to enter the large and growing market for early stage small molecule development and testing services.
Durham, North Carolina-based Avista, with 330 employees, claims a broad suite of scientifically differentiated services ranging from API and drug product development and cGMP manufacturing to standalone analytical, microbiology testing and solid-state sciences.
Like the $425 million acquisition of Halo Pharma that closed in September, Cambrex CEO Steve Klosk said the latest buy will open a new market segment and bring the company a large number of new customer relationships that will provide cross selling opportunities for its API and finished dosage form services. Another benefit will be a “significant increase in the funnel of molecules that may advance to commercial status.”
Including the microbiological testing business, Avista operates four facilities at Durham; Longmont, Colorado and Agawam, Massachusetts in the US and at Edinburgh, Scotland in the UK. The company has more than 400 active customers and is expected to generate approximately $65 million in annual revenue in 2018.