US-based generic pharmaceutical company Akorn Inc has agreed to buy its national competitor Hi-Tech Pharmacal Co Inc for $640m.
Hi-Tech is a specialty pharmaceutical business that develops, manufactures and promotes generic and brand name prescriptions, as well as over-the-counter (OTC) products.
Producing ‘difficult to manufacture liquid and semi-solid dosage forms’, Hi-Tech makes a range of oral solutions, topical ointments and creams, nasal sprays, otics, along with sterile ophthalmics and ointments.
The deal involves Akorn paying $640m in cash, or $43.50 per share.
Combined, the company is expected to make annual revenues of more than $500m.
Akorn’s chief executive officer Raj Rai said: "This is a transformative event for our company. The portfolio of Hi-Tech products is a great strategic fit to our currently marketed products as it diversifies our offering to our retail customers beyond ophthalmics to other niche dosage forms such as oral liquids, topical creams and ointments, nasal sprays and otics. In addition, we are excited about Hi-Tech’s product pipeline which would further enhance growth opportunities for the combined platform.
"The acquisition of Hi-Tech will also add branded OTC products in the categories of cough and cold, nasals, and topicals to Akorn’s existing TheraTears brand of eye care products. We also plan to capitalise on the manufacturing capabilities of Hi-Tech to further expand our presence in the private label OTC business."
Hi-Tech’s chief executive officer David Seltzer added: "We are excited about the transaction as it delivers compelling value to our shareholders. The combined portfolio of marketed products and products in development offer a very unique platform with great growth potential. We are very pleased to be joining forces with Akorn and their strong management team led by Raj Rai."
JP Morgan Securities LLC acted as the financial advisors to Akorn, while Kirkland & Ellis LLP and Polsinelli PC worked as legal advisors.
Hi-Tech had Nomura Securities International, Inc serve as financial advisors along with Arent Fox LLP and Tashlik Goldwyn Crandell Levy LLP, who acted as legal advisors in connection with this transaction.
Image: Hi-Tech makes a range of oral solutions, topical ointments and creams, nasal sprays, otics, along with sterile ophthalmics and ointments. Photo: courtesy of FreeDigitalPhotos.net.