Mumbai (India) based Piramal Enterprises Limited, a member of the Primal Group led by Ajay G. Piramal, one of India’s foremost business conglomerates with a presence in healthcare, healthcare information management and financial services, has confirmed that it has reached an agreement with University of Kentucky for the acquisition of Coldstream Laboratories Inc.
Under the terms of the agreement, Piramal Enterprises invests US$ 30.65 million towards acquiring Coldstream, through its wholly owned subsidiary in the USA in an all cash transaction. Of this, US$ 5.65 million would be towards the purchase of the facility building which is currently leased to Coldstream, while the rest would be towards purchase of 100% of the company’s shares.
Piramal Enterprises is one of the leading players globally in Custom Research and Manufacturing Services or CRAMS, as well as in the critical care segment of inhalation and injectable anesthetics. It also has a strong presence in the OTC segment in India. The company’s Molecular Imaging Division was formed in 2012 with presence in Europe and USA.
While the transaction was subject to corporate approvals, it did not require any regulatory approvals.
High potency and cytotoxic compounds
Coldstream, a Contract Development and Manufacturing Organisation (CDMO) focused on the development and manufacturing of sterile injectable products, was established in 1991 as the Center for Pharmaceutical Science & Technology (CPST), a unit of the University of Kentucky College of Pharmacy. Since its inauguration, the center completed more than 200 development projects that led to clinical trials.
In February 2007, the University decided to spin off the CPST in to a private company, Coldstream Laboratories, Inc., in order to keep pace with competitors and move at the speed of business. The company became a privately held and wholly owned by the University of Kentucky Research Foundation.
The company is a specialty pharmaceutical contract manufacturer with an emphasis on clinical trial to commercial-scale manufacturing of sterile liquid and lyophilized parenterals and injectables. As part of its offerings, Coldstream has developed differentiated expertise to formulate and manufacture high potency and cytotoxic compounds including antibody-drug conjugates.
Due to the complexity of the antibody-drug conjugates, establishing a supply chain for developing ADCs can be quite challenging. However, the acquisition of Coldstream is expected to bring the particular expertise of both companies together to support the manufacture of these cytotoxic bioconjugates including analytical testing, formulation, and process development of liquid and lyophilized sterile highly-potent ADCs.
Coldstream, which employs 91 people, operates from a FDA approved facility located in Lexington, Kentucky, USA. Revenues of Coldstream over the last three years are ~ USD 14 million (2014E), USD ~13 million (2013) and USD ~9 million (2012).
Commenting on the acquisition Vivek Sharma, CEO of Piramal Enterprises’ Pharma Solutions business noted “Coldstream is a very high quality operation and has been able to build significant customer relationships and track record for sterile products. We see this as a great platform for growth in our Pharma Solutions business. This acquisition allows us to move further into the injectable market segment and should have strong synergy with our existing Pharma Solutions business. Our strong capabilities in sterile product development and in ADC product segment will allow us to offer an integrated solution to our customers.”
“We have been impressed by the quality of the people at Coldstream and their success in both attracting high quality business and also their track record in quality. Coldstream’s use of isolator technology is impressive and provides a foundation for expansion of the facility to provide large scale commercial manufacturing including production of highly potent compounds,” added Bill Wedlake, President of Primal Enterprises’ Pharma Solutions Formulations business.
While the ADC market currently representing only a modest 5% of total revenues of the company, this segment is expected to increase to 8–10% over the next two years. Wedlake noted that the company, in the near future, is expected to offer conjugation in areas outside of oncology and hematology, such as antibiotics. Furthermore, the acquisition of Coldstream allows Piramal Enterprises to move further into the injectable market segment which already has strong synergy with the company’s existing Pharma Solutions business, which is expected to commercialize around 3–4 antibody drug conjugates over the next 3-5 years.