Amneal & Impax merger to create 5th biggest pharma generics firm in United States

Combined company to benefit from expanded generics product portfolio, premier diversified generics pipeline, broad R&D capabilities across dosage forms, high-quality and low-cost global manufacturing and distribution network, and enhanced financial foundation

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New Delhi: Amneal Pharmaceuticals LLC and Impax Laboratories have announced that they have entered into a definitive business combination in an all-stock transaction. As a result of the transaction, Amneal Holdings members will own 75% and Impax shareholders will own 25 percent of the new company’s pro forma shares.

The combined company, to be named Amneal Pharmaceuticals, Inc., will have a robust generics business that will rank as the 5th largest in the United States by gross revenue and a growing, high-margin specialty franchise.  The combined company is expected to have 2018 pro forma adjusted EBITDA of approximately $700 million to $750 million, which includes significant cost savings within the first full year of close. In addition to its broad existing commercial product portfolio, the combined organization will have a diverse and differentiated pipeline with more than 300 products either filed with the FDA or in active stages of development, a foundation for international expansion with select commercial presence in the United Kingdom and Germany, and cost-efficient global manufacturing and development capabilities in all dosage forms. The transaction is expected to enhance the combined organization’s competitive position and allow for continued success in an evolving generics market.

“In the 15 years since our family founded Amneal, we have established the company as a leader in the U.S. generic pharmaceuticals industry, and today marks an important milestone in these efforts,” said Chirag Patel, Co-Chief Executive Officer and Co-Chairman of Amneal. “This transaction combines the complementary strengths of both Amneal and Impax to create an even stronger company with the diversification, capabilities and resources to deliver enhanced value for patients, new opportunities for our collective employees and increased growth and value creation for shareholders.”

“We are excited to join with Impax to create one of the most dynamic companies in the pharmaceutical industry,” said Chintu Patel, Co-Chief Executive Officer and Co-Chairman of Amneal. “This combination will help us achieve our long-term goals of providing greater access to safe and affordable medicine for people around the world, while also positioning us for continued success.”

“This combination delivers on several key stated growth objectives for Impax,” said Paul Bisaro, President and Chief Executive Officer of Impax. “By combining Amneal and Impax, we create a more diversified company with one of the industry’s leading high-value generic product pipelines and a growing specialty business. Our combined portfolio will be supported by global, high-quality development and manufacturing capabilities.”

“This transaction is financially compelling as we expect the combination to be accretive to Impax’s standalone adjusted per share earnings in the first 12 months and generate double-digit growth in revenue and adjusted EPS over the three years following the close of the transaction. We expect to achieve annual cost synergies of approximately $200 million within three years,” Bisaro continued.  “The anticipated strong cash flows from the combined company allow for the repayment of debt and the ability to meaningfully invest in our business.”

The new company will be led by an experienced team with a proven track record in driving strong organic growth and successfully integrating acquisitions. Amneal’s Founders and Co-Chief Executive Officers, Chirag Patel and Chintu Patel, will serve as Co-Chairmen of the combined company’s Board of Directors. Paul Bisaro, President and Chief Executive Officer of Impax, will serve as Chief Executive Officer of the combined company, and Bryan Reasons, Senior Vice President, Finance and Chief Financial Officer of Impax, will serve as Chief Financial Officer. This leadership team will be supported by the combined company’s nearly 6,500 employees operating from strategically positioned locations around the globe.

Numerous Strategic Benefits to Drive Future Growth

  • Significantly Expanded Generics Portfolio: The combined company will have a generics portfolio with approximately 165 differentiated product families marketed in all dosage forms. The combined company will hold a #1 or #2 position in a significant number of its marketed product

  • Exceptional Generics Pipeline: The combination is expected to create one of the largest generic pipelines in the United States, with approximately 150 pending ANDAs and 165 projects in active stages of development. Nearly half of all pipeline products are exclusive first-to-file, first-to-market or other high-value opportunities with three or fewer competitors estimated at the time of launch. The combination also adds a foundation for commercial entry into biosimilars with two in-licensed products: one filed and one near-term filing opportunity in development.

    • High-quality R&D Capabilities: The combined company will have a strong commitment to R&D. Its annual R&D investment is expected to be approximately 10 percent of pro forma combined net revenue, with a focus on the strategic development of high-value products within generics and specialty pharmaceuticals. The combined organization’s internal generic R&D capability is expected to drive growth through continued investment in the development of complex dosage forms and technologies, including injectables, topicals, transdermals, inhalation, complex molecules and drug-device combinations. Additionally, the combined company is expected to benefit from well-established external partnerships focused on maximizing pipeline opportunities in specialty delivery forms and biosimilars.

  • Strengthened Global Supply Chain Capability: The combined company is expected to manufacture and distribute its products from a strengthened global supply chain supporting capabilities across all dosage forms, with R&D and manufacturing sites in the United States, India and Ireland.

  • Growing Specialty Franchise: The combined company will include Impax’s high-margin specialty franchise, which is expected to provide stable cash flow and long-term growth through its innovative platform of products targeting CNS disorders, anti-parasitic infections and other select specialty therapeutic areas. The specialty portfolio includes RYTARY® (carbidopa and levodopa), ZOMIG® Nasal Spray (zolmitriptan), EMVERM™ (mebendazole) and ALBENZA® (albendazole).