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Lannett to buy Kremers Urban Pharmaceuticals for $1.23bn

Lannett has agreed to acquire Kremers Urban Pharmaceuticals (KU), a US unit of Belgian drugmaker UCB, for $1.23bn.

KU, which focuses on generic products, has 18 generic drugs in the market for conditions including attention deficit hyperactivity disorder (ADHD), gastroesophageal reflux disease, hypertension and respiratory disease.

The company also has 11 drug applications pending approval from the US Food and Drug Administration and 17 drug candidates in several stages of development.

The transaction, which includes potential contingency payments, is expected to add to Lannett’s adjusted profit from next year.

As part of the deal, Lannett would receive KU’s 381,000ft² facility in Seymour, Indiana, which has manufacturing and warehousing capacity, as well as product development space.

Lannett CEO Arthur Bedrosian said: "The acquisition diversifies and augments our current product offerings and significantly enhances our opportunities for continued growth by expanding our pipeline with a number of large market opportunity and complementary product candidates.

"KU brings considerable manufacturing capacity, a first class research and development team and the potential for advancing our active pharmaceutical ingredients business."

The transaction, which is subject to regulatory approval, is expected to be completed in the fourth quarter.

UCB acquired KU when it purchased Schwarz Pharma in 2006. An earlier $1.53bn deal to sell the unit to Advent International and Avista Capital Partners was terminated in December last year, after the US Food and Drug Administration asked for additional studies on its Concerta pill for ADHD.