Sandoz to acquire Fougera Pharmaceuticals, becoming the number one generic dermatology medicines company

NovartisNovartis has signed a definitive agreement to acquire specialty dermatology generics company Fougera Pharmaceuticals. Under the terms of the agreement, Novartis will acquire the business, which is based in Melville, New York, for USD 1.525 billion in an all-cash transaction.

The sellers are comprised of a consortium of private equity funds led by Nordic Capital, DLJ Merchant Banking (a Credit Suisse affiliate) and Avista Capital Partners.

The acquisition creates another strong global growth platform for Sandoz, the generic pharmaceuticals division of Novartis. Based on 2011 IMS data, the combined businesses will become the #1 global company in generic dermatology medicines, with estimated annual global sales of nearly USD 620 million, primarily in the US.[1] Fougera has strong dermatology development and manufacturing expertise, with numerous launches planned for 2012 and beyond.

"The addition of Fougera's leading portfolio further strengthens Sandoz's differentiated products strategy and improves our ability to help patients and customers around the world by providing easier access to high quality, affordable dermatological medicines. Fougera brings us valuable technical capabilities in the area of topical dermatological products, particularly in the development and manufacturing of semi-solid forms such as creams and ointments," said Jeff George, Global Head of Sandoz.

"Fougera and Sandoz serve many of the same customers in the US, creating significant sales and cost synergies with Sandoz's sizeable US generics business," said Don DeGolyer, President of Sandoz US. "We welcome the team from Fougera Pharmaceuticals into Sandoz and Novartis."

Sandoz will leverage its leading position both in the US generics sector and its presence in over 130 countries worldwide to expand Fougera's existing sales base and bring its broad dermatology portfolio to new markets around the world.

Fougera is a specialty dermatology business with 2011 net sales of USD 429 million, and employs approximately 700 people across its two primary sites, located in New York. Fougera Pharmaceuticals operates two main businesses: Fougera, a leading player in the USD 2.1 billion US dermatology generics sector[2] with 45 products and more than 200 SKUs and PharmaDerm, a branded specialty pharma business with 17 brands and over 40 SKUs.

The transaction requires regulatory approvals and is expected to be completed in the second half of 2012. Based on Fougera Pharmaceuticals' 2011 earnings before interest, taxes, depreciation, and amortization (EBITDA) of USD 173 million, the acquisition represents a multiple of 8.8 times. The transaction is expected to be accretive to core earnings per share (EPS) and will be financed from the Group's existing cash resources and cash flow. The transaction meets Novartis' strict financial criteria for acquisitions relative to targeted cash flow return on investment (CFROI) metrics.

About Novartis
Novartis provides innovative healthcare solutions that address the evolving needs of patients and societies. Headquartered in Basel, Switzerland, Novartis offers a diversified portfolio to best meet these needs: innovative medicines, eye care, cost-saving generic pharmaceuticals, preventive vaccines and diagnostic tools, over-the-counter and animal health products. Novartis is the only global company with leading positions in these areas. In 2011, the Group's continuing operations achieved net sales of USD 58.6 billion, while approximately USD 9.6 billion (USD 9.2 billion excluding impairment and amortization charges) was invested in R&D throughout the Group. Novartis Group companies employ approximately 124,000 full-time-equivalent associates and operate in more than 140 countries around the world.

About Fougera
Fougera Pharmaceuticals Inc. operates two primary divisions in the US focused on specialty pharmaceuticals in dermatology: Fougera, its generic dermatology medicines business, and PharmaDerm, its branded dermatology business. Founded in 1849, the Fougera division is the leading manufacturer and distributor of a wide range of topical products. The PharmaDerm division is dedicated to developing and commercializing novel prescription products to treat diseases and conditions of the skin - the largest organ of the human body.

1. IMS MIDAS at gross ex-manufacturer prices
2. IMS MIDAS at gross ex-manufacturer prices, excluding OTC

Most Popular Now

Pfizer's elranatamab granted FDA Breakthrough Ther…

Pfizer Inc. (NYSE:PFE) announced its investigational cancer immunotherapy, elranatamab, received Breakthrough Therapy Designation from the U.S. Food and Drug Administrati...

Vividion Therapeutics names Jenna Goldberg as Chie…

Vividion Therapeutics, Inc., a biopharmaceutical company utilizing novel discovery technologies to unlock high value, traditionally undruggable targets with precision the...

Bayer with continued strong performance

The Bayer Group maintained its strong business performance across all three divisions in the third quarter. "Despite rising inflation and global supply chain problems, we...

Pfizer and BioNTech receive positive CHMP opinion …

Pfizer Inc. (NYSE: PFE) and BioNTech SE (Nasdaq: BNTX) announced a booster dose of their Omicron BA.4/BA.5-adapted bivalent COVID-19 vaccine (COMIRNATY® Original/Omicron ...

Sanofi and GSK's next-generation COVID-19 booster …

After the European Medicines Agency's Committee for Medicinal Products for Human Use (CHMP) adopted a positive opinion for VidPrevtyn® Beta, the vaccine was approved by t...

Sugar molecules as a target in cancer therapy

Cancer cells use sugar molecules on their surface to disable attacks by the body's immune system. Researchers at the University of Basel now report on how this mechanism ...

COVID vaccination improves effectiveness of cancer…

Patients with nasopharyngeal cancer are often treated with drugs that activate their immune system against the tumor. Until now, it was feared that vaccination against Co...

Making melanoma immortal: Pitt scientists discover…

Scientists at the University of Pittsburgh School of Medicine have discovered the missing puzzle piece in the mystery of how melanoma tumors control their mortality. I...

GSK announces positive Phase IIa study results for…

GSK plc (LSE/NYSE: GSK) announced positive results from a Phase IIa study demonstrating that GSK3036656, a first-in-class investigational antitubercular agent, was well t...

New drug shows promise for fighting both COVID-19 …

While vaccination can provide life-saving protection against COVID-19, scientists are still searching for ways to treat severe infections, including in people who cannot ...

Machine learning can help predict patient response…

Predicting which patients will respond well to treatment is a quandary that has plagued the field of cancer immunotherapy for more than four decades. Now, researchers at ...

Study reveals vaccine confidence declined consider…

A new study suggests that, despite the success of the COVID-19 vaccination campaigns, vaccine confidence has declined significantly since the start of the pandemic. Re...