Belgian chemical and pharmaceutical company, Solvay, says that it will be buying privately-owned French firm, Fournier Pharma, in a 1.3 billion euro all cash deal.
Industry speculation first mooted a possible link-up between the two firms late last year, and Solvay has been vocal about its desire to accelerate both the growth and profitability of its pharmaceuticals business.
Key to the deal from Solvay’s point of view is Fournier’s fenofibrate cholesterol lowering agent, which is sold under the brand name of TriCor by partner Abbott Laboratories in the USA. This drug is already a strong performer, with 2004 sales of $779 million dollars, and Solvay says it fits well with its own cardiovascular pipeline. The Belgian company has three cardiovascular drugs currently undergoing testing – SLV 306 for hypertension and congestive heart failure, SLV 319 for obesity, and SLV 320 for CHF and renal disease. Fournier is developing several other new products, including new combinations of fenofibrate with other molecules for novel indications, and has pipeline strength in several other disease areas. “The acquisition of Fournier Pharma would be an excellent and well-timed opportunity to accelerate the growth and profitability of our pharmaceuticals business, which we further expect to gain tremendous momentum when the full potential of the combined R&D pipeline kicks in,” said Aloïs Michielsen, chairman of the Solvay’s executive committee.
Solvay is planning to undertake a detailed review of the company over the next four weeks and, pending its outcome and regulatory clearance, expects the deal to close during the summer of 2005.
Fournier recorded earnings of some 138 million euros in 2004, with turnover of 593 million euros. The deal would boost Solvay’s 2004 pro forma pharmaceutical revenues by 34%, and increase profits by 54%. The combined company would have a research and development budget in the region of 370 million euros.