Hikma Pharmaceuticals has dropped the cash portion of its offer for Boehringer Ingelheim’s US generics unit Roxane Laboratories by some $535 million, after due diligence revealed much lower than expected revenue performance and forecasts.

Back in July, Hikma said it would pay $1.18 billion in cash and 40 million new shares to Boehringer for its Roxane division in a deal worth around $2.65 billion. 

However, after due diligence, the firm is now anticipating that Roxane’s total revenue for 2017 will be between $700 million and $750 million, rather than the previous expectation of $725 million-$775 million, prompting a revised offer worth around $2.1 billion.

The firm said it still expects the acquisition to be “strongly accretive” from 2017 onwards, and that BI will continue to hold a 16.71% stake in Hikma following closing, as the equity component of the consideration remains unchanged.

“We remain very excited about the strategic and financial value of this acquisition, which will transform our position and scale in the US generics market,” noted Said Darwazah, Hikma’s chief executive.

With 90 “highly differentiated” products in specialised and niche segments of the market, bringing Roxane into its fold would see Hikma take sixth position in the top generic medicines suppliers in the US.