Albany Molecular Research (AMRI), a global contract research and manufacturing organization, has signed a definitive agreement to acquire all outstanding membership interests of Oso Biopharmaceuticals Manufacturing (OsoBio) for $110 million in cash.
OsoBio is a contract manufacturer of highly complex injectable drug products, including sterile liquid, suspension and lyophilized formulations. The acquisition and associated fees are expected to be financed through cash currently held by AMRI, and it is expected to be completed in the third quarter of 2014.
"The acquisition of OsoBio is highly complementary to our finished-dose manufacturing business, and is consistent with our strategy to be the preeminent supplier of custom and complex drug development services and products to the pharmaceutical industry," said William S. Marth, AMRI's president and CEO. "OsoBio adds significantly to our sterile manufacturing capabilities, extending our position in early stage contract manufacturing to now include OsoBio's large-scale commercial production. In addition, we expect to realize savings in capital costs associated with the previously planned facility expansion."
Milton Boyer, OsoBio's president, said, "The addition of AMRI's experience and capabilities in early phase development greatly increases the value proposition for our customers, providing a single source to address all sterile fill/finish needs from phase I development complete to commercial supply."
On a standalone basis, OsoBio's forecasted full year 2014 revenue is between $58 million and $60 million, with adjusted EBITDA of $9 million to $10 million, implying a purchase price multiple of 11 times 2014 adjusted EBITDA at the top end of the range. Adjusted EBITDA excludes any deal-related costs or purchase accounting impacts.
OsoBio is expected to continue to operate independently within AMRI's Drug Product business unit. Milton Boyer, the current president and CEO, will lead the OsoBio team and report to Steven Hagen, Ph.D., AMRI's senior vice president of manufacturing and pharmaceuticals.