H.I.G. Capital Acquires BioVectra from Mallinckrodt for $250 Million to Expand API Manufacturing Capabilities

On September 20, 2019, VCBeat (WeChat ID: vcbeat) learned from foreign media reports that private equity firm H.I.G. Capital (HIG) announced the acquisition of BioVectra, a wholly-owned subsidiary of Mallinckrodt, for $250 million. The transaction includes an upfront payment of $135 million, long-term notes worth $40 million, and contingent consideration of $75 million.

The acquisition is expected to be completed in the fourth quarter of 2019. Upon completion, HIG and Mallinckrodt will continue to advance the research, development, and manufacturing of biologics.

BioVectra, founded in 1970 and headquartered in Charlottetown, Canada, is a contract development and manufacturing organization (CDMO). The company primarily provides active pharmaceutical ingredients (APIs) and intermediates to pharmaceutical and biotechnology companies worldwide.

CDMOs are academic or commercial scientific institutions that provide clinical research services for new drugs to pharmaceutical companies through contractual agreements. These organizations accept commissions from pharmaceutical companies and supply active pharmaceutical ingredients (APIs), intermediates, powder injections, and packaging for product manufacturing through processes such as process development, formulation development, production of investigational medicinal products, and chemical or biological synthesis.

BioVectra is a reliable partner with over 45 years of experience in the development of novel drugs and advanced therapies, possessing expertise in synthesis and processing technologies such as organic synthesis, biomolecular fermentation, downstream processing, and conjugation chemistry. The company’s operations primarily focus on cGMP microbial fermentation, complex chemical synthesis, formulation development, and the production of high-potency APIs and biologics, supporting the development of therapeutics for cancer, kidney disease, cardiovascular disease, multiple sclerosis, and other serious conditions.

H.I.G. Capital, founded in 1993 and headquartered in Miami, USA, is a global leading private equity firm. The company is committed to promoting the development of small and medium-sized enterprises, primarily investing in sectors such as biotechnology and healthcare, as well as real estate, with over $31 billion in assets under management. To date, H.I.G. has invested in and managed more than 300 companies worldwide, with total sales exceeding $30 billion.

Mallinckrodt, founded in 1867 and headquartered in Surrey, United Kingdom, is a global biopharmaceutical company. The company is dedicated to developing medical products to advance three key areas: diagnostic imaging, respiratory therapies, and analgesics. With operations in more than 100 countries worldwide, Mallinckrodt’s novel drugs and advanced therapies are primarily used to treat autoimmune diseases and rare disorders in the fields of neurology, rheumatology, and nephrology.

Mark Trudeau, CEO of Mallinckrodt, stated, “BioVectra not only possesses unique biotechnology capabilities but also holds significant growth potential in complex chemical synthesis, biologics, and drug development. This acquisition will undoubtedly drive the growth of both Mallinckrodt and BioVectra.”

Mike Gallagher, Managing Director of HIG, stated, “We warmly welcome BioVectra to our portfolio. The company leverages its advanced technologies and expertise to support drug developers. Currently, BioVectra is expanding its operations and driving growth in the biopharmaceutical market. HIG will leverage BioVectra’s technology platform to develop novel therapeutics that meet market demands.”

(Compiled by Xu Xiaoxue)