WuXi PharmaTech, a provider of pharmaceutical R&D outsourcing services from China, has signed a definitive agreement to acquire US-based AppTec Laboratory Services, (AppTec).
The acquisition of AppTec allows WuXi PharmaTech to immediately obtain biologics capabilities and expertise, gain a significant U.S. operational footprint, and expand its customer base and addressable market size. The combined business operations of WuXi PharmaTech and AppTec in both the US and China will enable WuXi PharmaTech to provide a full service suite of outsourced chemistry and biology services to global pharmaceutical, biotechnology and medical device clients. The transaction consideration totals approximately $151 million with the assumption of AppTec debt totaling approximately $11.7 million.
AppTec is a service provider for the biopharmaceutical and medical device industries, offering testing, contract research and development, and biologics cGMP manufacturing services from a highly differentiated, fully integrated service platform. Along with state-of-the-art FDA registered facilities located in Philadelphia, St. Paul and Atlanta, AppTec brings established customer relationships with many leading pharmaceutical, biotechnology and medical device companies in the U.S. and around the world. AppTec's full year 2007 revenue is expected to be in the range of $70 million to $72 million. Since 2004, and including the expected revenue for 2007, AppTec will have achieved a compounded annual revenue growth rate of approximately 46%.
Dr. Ge Li, Chairman and Chief Executive Officer of WuXi PharmaTech, said, "We are very excited to announce the combination of WuXi PharmaTech and AppTec Laboratory Services, an important milestone in realizing our vision of becoming the global R&D outsourcing leader. WuXi's chemistry services will be complemented by AppTec's biologics testing and manufacturing capabilities to create a fully integrated service platform, from which we will be able to provide more value-added services to our customers. With an expanded geographic footprint, and a broader and deeper scope of services, we are well positioned to drive growth and continue to increase shareholder value."
Dr. Bonita L. Baskin, Chief Executive Officer of AppTec, said, "Combining these two companies creates a unique single source platform that has the ability to transform the outsourced R&D model globally."
The transaction has been approved by the AppTec and WuXi PharmaTech boards of directors and AppTec's shareholders, and is expected to close, subject to regulatory and other customary closing conditions, in the first quarter of 2008. No approval by WuXi PharmaTech's shareholders is required.