QLT to broaden footprint with acquisition of Atrix
Biotechnology firm QLT will acquire Atrix Laboratories in a stock and cash deal valued at $855 million. QLT has one approved drug, Visudyne (verteporfin), for age-related macular degeneration, that had 2003 sales of $357 million and is sold by Novartis. Atrix will bring Eligard (leuprolide acetate), a drug approved for prostate cancer, and the Atrigel sustained-release drug delivery system. Two other Atrix products are expected to hit the market in 2005: a sustained-release version of Eligard and Atrisone, a topical acne product. Atrix, which had sales of $50 million last year, has strategic alliances with companies including Pfizer, Novartis, and Aventis and is expected to be profitable this year. Although QLT says it has branched into dermatology, oncology, and urology, industry observers note the firm is under pressure in its core area of ocular disease because of new drugs under development at Eyetech Pharmaceuticals, Genentech, and elsewhere. QLT CEO Paul Hastings acknowledged in a conference call that the deal reduces QLT's risk of being a single-product company. QLT declined to comment on stock analysts' concern that the bid is too low and leaves the door open for a counteroffer from a larger drug or biotech company.
Just as its major competitors have enlarged their home care services business, now, too, has Praxair. The firm has signed a definitive agreement to acquire Home Care Supply from private equity firm Harvest Partners for $245 million. Home Care Supply had 2003 revenues of $169 million and claims to be the largest privately held home respiratory and medical equipment provider in the U.S. Air Products & Chemicals bought American Home Care Supply in late 2002, while Air Liquide recently completed the acquisition of 51% of Allertec Homecare in Thessaloniki, Greece.
Schering AG last week announced a restructuring program that includes job cuts, plant closures, and a refocusing of its research efforts. With the creation of a new oncology unit, the company will concentrate on oncology, gynecology and andrology, diagnostic imaging, and specialized therapeutics. Schering says it will end R&D in cardiovascular and central nervous system diseases, with the exception of work on multiple sclerosis and Parkinson's disease. Schering will also create a separate company for its $240 million dermatology business. The restructuring, which includes closing 12 of 24 production sites, is expected to deliver $240 million in annual savings and lead to a reduction of 2,000 employees by 2006.
Last week's rebroadcast of a CBS "60 Minutes" report on lax security at U.S. chemical plants, originally aired in November, prompted Thomas E. Reilly Jr., the American Chemistry Council's new CEO, to call for Congress to ensure that all U.S. chemical facilities tighten security to prevent terrorist acts. CBS said little has changed since the first broadcast and pointed out that legislation setting security standards at chemical plants has languished in Congress for more than a year. Reilly urges Democrats and Republicans to set aside their differences and "require all chemical facilities to address security as rigorously as do our members." Critics point out that even if pending legislation is enacted, it carries no criminal enforcement penalties for companies that don't comply.
Fine chemicals manufacturer Hovione and drug delivery technology firm CyDex have formed a partnership to develop generic drug formulations using CyDex's Captisol technology. The firms plan to improve bioavailability, dissolution, and stability in formulations for six undisclosed drugs. The agreement is an expansion of an existing deal under which Hovione is making Captisol, a modified cyclodextrin, for CyDex. Captisol is currently used as a delivery system for two drugs marketed by Pfizer.
A consortium of major petrochemical companies in Europe has been given the green light from the European Commission to go ahead with the long-discussed propylene pipeline in Northwest Europe. European Union approval was necessary to cover roughly $32 million in subsidies from the German, Dutch, and Belgian governments toward the total pipeline cost of more than $200 million. The pipeline will run from Rotterdam via Antwerp to Cologne and the German Ruhr area, feeding chemical plants along the way. The aid has been granted to the European Pipeline Co. consortium, which will own and operate the line.
Diversa says it has reached all 2004 milestones under a joint venture with Syngenta that is developing enzymes for animal feed and food processing applications. One of the enzymes, Quantum brand phytase, is demonstrating superior performance, according to David Jones, Syngenta's head of business development. Thanks to Syngenta milestone payments, Diversa now expects second-quarter revenues of $14 million, up from an earlier estimate of $12.5 million. Its quarterly loss should be $10.5 million, versus the $12 million previously expected. Separately, Diversa launched one of its first independent products last week, a cotton-processing enzyme called Cottonase.
To support its metabolic engineering R&D, Degussa has licensed the bioinformatics technology of Switzerland's Genedata. Involved are Genedata's Phylosopher and Expressionist packages. The technology gives Degussa "a comprehensive solution to our ambitious bioinformatics requirements ranging from expression data analysis to functional genomics and biological knowledge databases," says Ralf Kelle, head of biotechnology R&D at Degussa's feed additives unit.
Exports and imports of chemicals declined in April from the previous month, while both increased from April 2003, according to Commerce Department data. The chemical trade deficit, however, deepened substantially from both periods. Exports totaled $8.85 billion, down 9.3% from March but 16.2% ahead of April a year ago, while imports of $9.98 billion were down 4.2% month-to-month and up 15.9% from 12 months earlier. Thus, the April chemical trade deficit was $1.13 billion, compared with deficits of $650.3 million in March and $990.6 million in April of last year.
Five members of the Paper, Allied-Industrial, Chemical & Energy Workers International Union (PACE) have gone to Taiwan to protest and launch a hunger strike outside China Synthetic Rubber and Taiwan Cement, the corporate parents to their employer, the carbon black producer Continental Carbon in Ponca City, Okla. The members have been engaged for the past three years in a bitter dispute with management. Taiwan authorities have threatened the hunger strikers with deportation, claiming that their business visas do not allow them to conduct demonstrations. Continental Carbon officials say the PACE group is the only one of five unions at the plant that has failed to reach a labor agreement.
Eastman Chemical has formed a collaboration in performance chemicals with Indian contract research and fine chemicals firm Shasun. The firms have already worked together on excipients and will now explore process development and engineering. "Eastman continually looks for ways to maximize its resources, and this includes R&D resources," the company says, citing outsourcing as one of the means at it disposal.
Akzo Nobel's coatings division has sold its French industrial resins business to Spain's Derivados Forestales Group. The business, called Casco Industrie, had sales just shy of $20 million last year and makes formaldehyde and resins at a plant in Ambarès, France. Casco's wood adhesives operations were not included; rather, Casco Adhesives will take over Derivados' customers in Spain and Portugal. Derivados will be a toll producer of wood adhesives for Casco Adhesives.
Asahi Kasei will sell its 25% holding in Thai Plastic & Chemicals to Thailand's Siam Cement Group for close to $100 million. About 10% of the polyvinyl chloride maker will go to Siam Cement itself and the other 15% to CPB Equity, a subsidiary of Thailand's Crown Property Bureau, which is Siam Cement's major shareholder. After the sale, Siam Cement and its affiliates will own more than 57% of TPC.
SABIC's board of directors has approved investments of $6.4 billion to expand facilities in Saudi Arabia. Included in the plans are previously announced petrochemical plants in Yanbu, on the Red Sea coast, that will produce a total of 3.8 million metric tons per year of ethylene, ethylene glycol, polyethylene, and polypropylene by 2007. Foster Wheeler Energy will manage the project. SABIC will also expand capacity of Eastern Petrochemical Co.--a 50-50 joint venture with a Japanese consortium led by Mitsubishi--adding 2.9 million metric tons of ethylene, polyethylene, and ethylene glycol by 2008. And it is scheduling an additional 1.7 million metric tons of methanol capacity at Saudi Methanol Co. by the second half of 2007, making the 50-50 joint venture with Mitsubishi the largest methanol-producing complex in the world.
Teva Pharmaceutical Industries will work with Active Biotech to develop the latter's laquinimod, an oral multiple sclerosis treatment. Teva will pay Active $5 million up front and up to $92 million in milestone payments.
The European Commission has cleared Lyondell Chemical's acquisition of Millennium Chemicals, following an investigation that did not find any threat to competition in the European Union.
Japan's Central Glass International has launched Fluorolabs, a custom synthesis capability, at its SynQuest Laboratories subsidiary in Alachua, Fla. Central Glass says it expanded custom synthesis capacity there in April.
BASF will produce polyether polyols using Bayer's Impact technology under a new license agreement. The Bayer technology specifies a process for polyoxyalkylation that uses double metal cyanide as a catalyst.
Eastman Chemical's Peboc facility in Wales has been inspected by FDA and cleared to produce an active pharmaceutical ingredient. Eastman says the inspection opens "an array of manufacturing opportunities" in the pharmaceutical realm.
Dixie Chemical has purchased Buffalo Color's anhydride and alkyl anilines business. The purchase will give Dixie product lines in methyl anhydrides and succinic anhydrides.
MDS Nordion will contract manufacture Molecular Insight Pharmaceuticals' BMIPP, a heart-imaging drug that is radiolabeled with iodine-123. MDS calls itself North America's major supplier of iodine-123.