Earlier this year, Boehringer Ingelheim said it was considering selling its U.S.-based generics business for up to €2 billion ($2.2 billion) to focus on branded meds. Now, Hikma Pharmaceuticals, Mallinckrodt and Perrigo are approaching the bidding table, Bloomberg reports.
Boehringer is considering swapping assets or selling its Roxane Labs unit, with Hikma, Mallinckrodt and Perrigo reportedly laying down proposals. A decision on the winner could be made within weeks, but the German drugmaker may still choose to hold onto the business, sources told the news outlet. While Boehringer would prefer an asset swap, that type of deal may prove more difficult than selling the business outright, they added.
In January, Boehringer said it had tapped Morgan Stanley to explore its options for the Columbus, OH-based Roxane Labs, but had not decided whether to move forward with a sale, company spokeswoman Kathy Vincent told FiercePharma at the time. The unit, which develops and markets Boehringer’s generic drugs and boasts about 1,300 employees, has a better track record with regulators than Ben Venue Laboratories, the troubled injectables business that Boehringer unloaded to Hikma last year. And there “may be other strategic options that can better support the already successful Roxane Labs business and its significant future potential,” Vincent said at the time.
Still, the company started approaching interested buyers for Roxane in April, a company spokeswoman told Bloomberg. Hikma, Perrigo and Mallinckrodt declined to comment on a potential deal.
A deal for Roxane Labs could mean big things for Hikma, as it looks to broaden its portfolio and build on its previous relationship with Boehringer. Last year, the Jordan-based drugmaker shelled out $300 million in cash and performance-related milestones to snag assets and injectable products from the Ben Venue unit. Hikma also bought a troubled Ben Venue plant in a separate deal, but has since gutted the facility and used the equipment in other plants.
Snatching up Roxane Labs could also help Mallinckrodt, Jeffries analyst Anthony Petrone said in a note to clients. Mallinckrodt is trying to bulk up in generics, and Roxane brings a portfolio of 200 oral, liquid, topical and nasal generic products to the table. And although the two have some overlap in offerings, Roxane would hand Mallinckrodt “several key products” including generic Flonase and generic oral Suboxone, Petrone said.
By Emily Wasserman