Fresenius Kabi to buy Merck KGaA biosimilar candidates

By Flora Southey contact

- Last updated on GMT

iStock/digitalgenetics
iStock/digitalgenetics

Related tags: Merck kgaa, Clinical trial

Fresenius Kabi has announced plans to purchase Merck KGaA’s biosimilars business. 

The deal includes the acquisition of Merck KGaA’s entire biosimilar product pipeline, which focuses on oncology and autoimmune diseases. The majority of these candidates are in pre-clinical phase.

“Biosimilars are a fast-growing segment within the pharmaceutical market. Some of the largest biological branded products will go off patent over the next few years” ​said Fresenius Kabi CEO, Mats Henriksson.

The branded versions of the drug candidates Fresienius Kabi is buying generate revenue of around $30bn (€32.5bn) a year.

Merck told BioPharma-Reporter the sale is strategic, explaining “the divestment of our Biosimilars business is a logical next step in the implementation of Merck’s Healthcare strategy.”

Merck said the divestiture will allow the company to align its resources towards drug development in its healthcare business sector.

“The parties agreed to enter into supply and services agreements, which include drug development support and manufacturing services,” ​said Merck.

Merck will not sell its manufacturing facilities. Instead, Fresenius Kabi will produce biosimilars at the Merck sites in Aubonne and Vevey, Switzerland, in collaboration with the firm. It will also take on over 70 people currently employed by Merck.

€670m ($729m) deal

Fresenius Kabi announced the acquisition price to be up to €670m ($729m), comprising of €170m ($185m) cash upon closing and approximately €500m ($544m) in milestone payments dependent on achievements of development targets. First sales are predicted by the end of 2019.

Fresenius expects increased costs in quality requirements specific to biosimilars, analytical testing, clinical studies and marketing activities, as a result of the acquisition.

The deal is subject to regulatory approvals and is predicted to close in H2/2017.

The acquisition was announced the same day as Fresenius Kabi released it is purchasing U.S-based manufacturer Akorn​.

Related topics: Markets & Regulations

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