Aspen Pharmacare Holdings Limited (Aspen) has signed definitive joint venture (JV) agreements with Indian-based Matrix Laboratories Limited (Matrix). The deals strengthen Aspen鈥檚 vertical integration into the manufacture of Active Pharmaceutical Ingredients (APIs), the key raw materials required in the manufacture of finished dosage form pharmaceuticals including anti-retrovirals (ARVs), and they unlock additional global supply and manufacturing opportunities.
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The basis of the two JVs is:
- The sale of 50% of Aspen鈥檚 100% ownership of Cape Town based Fine Chemicals Corporation Pty Ltd (FCC) to Matrix for a purchase consideration of US$ 20million. FCC is South Africa鈥檚 leading API manufacturer and a major exporter of product to the USA and other territories;
- Aspen to acquire a 50% stake of a newly incorporated Indian company, Astrix Laboratories (鈥淎strix鈥�), into which Matrix will transfer an API manufacturing facility, technology and intellectual property (IP) for a consideration of US$36,5 million
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Stephen Saad, Aspen鈥檚 Group Chief Executive said 鈥渢he JVs strengthen Aspen鈥檚 supply source for APIs to meet the increasing demand for pharmaceutical products, most notably ARVs. The deals also provide for additional global trading opportunities for Aspen. Matrix鈥檚 technological expertise complements Aspen鈥檚 successful strategy of manufacturing quality, internationally approved medicines, including ARVs. The finished dosage form products for which the APIs are required will be manufactured at Aspen鈥檚 US Food and Drug Administration (FDA) and World Health Organisation (WHO) accredited Oral Solid Dose (OSD) facility in Port Elizabeth鈥�.
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Saad added that he expected Astrix to record revenue in the order of $40 million in its first full year of operation and that Aspen would be a material customer.
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N Prasad, Executive Chairman of Matrix said 鈥渢he long-term strategic relationship between Matrix and Aspen is a great leap forward. It will result in combining the strengths of both the companies to achieve global leadership positions by meeting the large unfulfilled needs in the treatment of HIV/AIDS. This alliance also gives Matrix a strategic presence in South Africa. Technological expertise provided by Matrix will assist in unlocking additional value in the FCC business.鈥�
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The Astrix facility, situated near Hyderabad, will be Aspen鈥檚 lead supplier of ARV APIs. Astrix will also continue supplying its existing customer base with ARV APIs. The site offers scope for modular expansion and in terms of the agreement Astrix may also source additional API volumes from other Matrix production facilities on a toll-manufacture basis.
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Approvals for the JVs are subject to approvals by, inter alia, the South African Reserve Bank, the Reserve Bank of India and South Africa鈥檚 Competition authorities.
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JSE listed Aspen is the southern hemisphere鈥檚 largest generic pharmaceutical manufacturer and a global leader in generic ARVs. Matrix is a leading international API manufacturer listed on the National and Bombay Stock Exchanges.
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The US FDA鈥檚 2004 accreditation of Aspen鈥檚 world class OSD facility and registration of its co-pack triple combination generic ARV treatment qualified 糖心vlog as the first generic supplier under President Bush鈥檚 Emergency Plan for AIDS relief (PEPFAR) programme to which funding of US$15 billion has been committed.
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Aspen has actively pursued a meaningful solution to the provision of high quality, affordable generic ARVs in the fight against HIV/AIDS. Aspen pioneered the conclusion of voluntary licence agreements with leading multinationals for the manufacture of generic ARVs which were developed in Aspen鈥檚 own laboratories. This underscores Aspen鈥檚 scientific and technical capabilities, its manufacturing and quality standards, and GMP compliances. Aspen was also recently awarded the lion鈥檚 share of the South African government鈥檚 ARV tender.
