Kyushua Pharmaceuticals' $790 million acquisition of Novaral's CDMO subsidiary is on fire!

Jiuzhou Pharmaceuticals announced on the evening of September 4 that it had signed an agreement with Novaral Investment to acquire a 100% stake in Suzhou Novarma after the divestiture of technology and pharmaceutical development assets held by the other party with a self-financing investment, with an estimated transaction price of 790 million yuan. Kyuschu Pharmaceuticals said in a statement that the acquisition is aimed at further expanding the CDMO program, developing new products and delivering rapid business growth.
Regarding the impact of this transaction, Kyushua Pharmaceuticals is confident that it will further enhance its position as a strategic supplier to Novaral Group's global supply chain, and that Suzhou Novarce will serve as a high-end research and development and commissioned production base to support the company's business development in Europe and North America.
In fact, the acquisition of Suzhou Novaral by Kyushua Pharmaceuticals has already been followed. As an important strategic supplier in Novart's global supply chain, Kyushua Pharmaceuticals has established a partnership since the 1990s, and Novart Group has been one of the top five customers of Kyushua Pharmaceuticals for the past three years.
For Novar3, the sale of the subsidiary to Kyushua Pharmaceuticals is also beneficial, the agreement provides that, within five years from the date of delivery of the transaction, Kyushua Pharmaceuticals will supply Novaral Ireland with three pharmaceutical products, namely anti-heart failure treatment, breast cancer treatment and leukemia treatment, and a further five years after the end of the five-year period.
After the acquisition is completed,the company will give full play to Suzhou Novarchi's core business advantages, optimize the company's core business advantages in areas such as innovative drug CDMO one-stop service, and meet China's fast
-growing commissioned research and development and production needs, Kyushua Pharmaceuticals said in a statement.
According to Kyusho Pharmaceuticals' 2019 Semi-Annual Report, Kyusho Pharmaceuticals' CDMO business currently covers new drug development projects in the field of treatment of hot diseases such as anti-tumor, antidepressant, anti-Parkinson's, anti-hepatitis C, anti-diabetic, anti-respiratory infection, etc.
In terms of results, the company reported revenue of 858 million yuan in the first half of this year, down 6.72 percent year-on-year, and net profit of 103 million yuan, up 15.51 percent year-on-year. In addition, Kyuszhou Pharmaceuticals has undertaken 11 CDMO projects, 35 projects in Phase III. Clinical Trials, and 294 Phase I. and II Clinical Trials.
However, Kyushua Pharmaceuticals such achievements in the CDMO industry is not conspicuous, in fact, the domestic CDMO business and CRO business are in the initial stage, by a few enterprises monopolized, of which Pharmaceutical Mingkang is the industry's leading enterprises.
According to the 2019 semi-annual report of Drug Mingkang, the first half of this year, Drug Mingkang CDMO services achieved revenue of RMB1,717 million, up 42.03 percent year-on-year. It can be said that in the face of industry giants such as Pharmaceutical Mingkangde and other enterprises, Kyushu Pharmaceuticals this acquisition of Novaral's subsidiary is also a self-insurance action.
It is worth noting, however, that Kyushua Pharmaceuticals' CDMO business hit a nadir in 2016 and an important factor in its subsequent recovery was the popularity of Novartis' new anti-heart failure drug, Entersto. As one of Entersto's top three suppliers of raw materials, Kyushua Pharmaceuticals' acquisition of Novaral's subsidiary may further boost sales.
In fact, as a CDMO company, Kyuschu Pharmaceuticals is confident in the industry, according to Kyusyu Pharmaceuticals' 2018 annual report, CDMO's product concentration areas are popular drug markets. The anti-tumor sector remains the largest market in the future, with sales of about 233 billion yuan in 2021, a compound growth rate of 12.2%, and diabetes will be the second largest market, with sales of $59.5 billion and a compound growth rate of 3.7% in 2024. Kyuschu Pharmaceuticals said in its annual report that it will accelerate the expansion of CDMO services.
CDMO industry stagsIn fact, the domestic layout of CDMO enterprises, there are local pharmaceutical companies as well as foreign pharmaceutical companies, foreign pharmaceutical companies in Boehringer Ingelheim BioXc Ellence is the only foreign-owned CDMO company to invest real money in building a biopharmaceutical plant in China and has more than 35 years of experience in this area, although Grigg Ingham is currently working on a pilot system for drug-listed holders in China.
Local pharmaceutical companies, in addition to the drug Mingkangde, there are Mei Berry, Sansheng Guojian, Kingsley and Kailaiying and other enterprises in the CDMO industry, but as mentioned earlier, the domestic CDMO business and CRO business are the same In the initial stage, before the drug Mingkangde led the track, after a group of small and medium-sized enterprises, in order to gain a foothold in the industry, but also need to strengthen their own strength, after all, just in the reckless stage of the CDMO track, all unknown is possible.
Perhaps this Kyushua Pharmaceuticals acquisition of Novarma subsidiary may see this, according to data show that Suzhou Novarma has a number of high-efficiency production lines, and has continuous reaction and enzyme catalytic reaction process equipment, related raw materials and intermediate products corresponding to innovative drug treatment areas including heart failure, breast cancer and leukemia.
It can be said that Suzhou Novart's advantages will be in the future Kyushua Pharmaceuticals to shake off other rivals of the important force. After all, for Kyuschu Pharmaceuticals, in the early stages of development of the industry is the best time to distance themself from other competitors, Kyuszhou Pharmaceuticals thought so, and also to do so. (
Sina Pharmaceutical News
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