Baxter International Inc., a global leader in sterile medication production and delivery, today entered into a definitive agreement to acquire Claris Injectables Limited, a wholly owned subsidiary of Claris Lifesciences Limited, for total consideration of approximately $625 million. Claris Injectables will add proven capabilities in production of essential generic injectable medicines, such as anesthesia and analgesics, renal, anti-infectives and critical care in a variety of presentations including bags, vials and ampoules. The Boards of Directors of both companies have approved the proposed acquisition, which is expected to close in the second half of 2017. Upon closing, the deal is expected to be modestly accretive to adjusted earnings and increasingly accretive thereafter.
Sterile medication production is a core competency for Baxter, which manufactures a broad range of essential generic injectable medications—including both frozen and liquid preparations—that treat some of the most pressing healthcare needs facing patients today. Baxter currently participates in a differentiated segment of the generic injectables market with difficult-to-manufacture oncology drugs and a broad portfolio of standard-dose, ready-to-use premixed injectable products including essential anti-infectives, analgesics and critical care medicines. Baxter estimates that today the global sterile generic injectables market is more than $40 billion growing at a 10 percent compound annual growth rate.
Claris Injectables, based in Ahmedabad, India, is a global generic injectables pharmaceutical company with a successful 15-year history. The acquisition of Claris Injectables will provide Baxter with a robust pipeline and marketed portfolio of generic injectables with 11 molecules currently approved in the U.S. along with fully integrated research and development expertise and three world-class manufacturing facilities registered with a number of global regulatory agencies, including the U.S. Food & Drug Administration (FDA). Claris Injectables will be a foundational asset to accelerate Baxter’s strategy to become a global leader in the injectable pharmaceuticals space. Baxter will build upon Claris Injectables’ existing footprint by adding Baxter’s differentiated technologies and making strategic investments to expand Claris Injectables’ R&D pipeline and manufacturing capacity. Through this combination, Baxter anticipates launching seven to nine new products annually over the next few years, increasing to 10-15 anticipated new product launches a year beyond 2019.
“The Claris Injectables acquisition will expand Baxter’s presence in the fast growing, global generic injectable pharmaceuticals space and accelerate our growth trajectory with high-value, essential medicines that will benefit patients worldwide,” said Jose (Joe) Almeida, Chairman and Chief Executive Officer, Baxter. “The capabilities we gain with Claris Injectables will augment and complement our differentiated technologies, expertise and extensive presence in the hospital channel to create a pathway for Baxter to become a global leader in generic injectables.”
In 2016, Claris Injectables is expected to deliver annual global revenues in excess of $100 million. Global revenues for Claris Injectables business have increased by double-digits annually over the last several years driven by new product launches and geographic expansion. Baxter expects to finance the transaction through cash on hand, debt or a combination.
“We are pleased to announce this agreement with Baxter,” said Arjun Handa, Executive Vice Chairman and Group MD of Claris Lifesciences Ltd. “Baxter’s deep and long history, roots in the hospital business, and expertise to advance the business as a strategic platform will catapult the combined organization’s R&D, manufacturing and people capabilities. I strongly believe that this weaves forward a promising pathway for our patients, team members, partners and stakeholders.”
“We look forward to welcoming the Claris Injectables employees who share Baxter’s commitment to innovation, dedication to quality and mission to save and sustain lives,” added Almeida.
The transaction is subject to regulatory approvals and other customary closing conditions.