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Mergers & Acquisitions

Drug service provider Alcami to go to another private equity firm

New investor takes on a company trying to combine a range of pharmaceutical services

by Rick Mullin
June 1, 2018

A worker in side the plant of Alcami. Lots of piping around a big vessel.
Credit: Alcami
Alcami manufactures active pharmaceutical ingredients at the former Cambridge Major site in Wisconsin

The pharmaceutical services firm Alcami is being acquired by Madison Dearborn Partners, a Chicago-based private equity investor, for an undisclosed sum. Madison Dearborn will purchase a majority ownership stake from Alcami’s current owner, Ares Capital, another private equity firm.

Alcami was formed in 2013 through the merger of AAI Pharma, a Wilmington, N.C.-based analytical services firm, and Cambridge Major Laboratories, a Germantown, Wisc.-based pharmaceutical chemical maker. Stephan Kutzer, a former Lonza executive, was named Alcami’s CEO in 2014, with the goal of combining the companies into a U.S.-based provider of analytical chemistry, pharmaceutical chemical synthesis, and finished-dose drug production. Kutzer brought in a new team, including many from Lonza, to integrate the two firms.

The formation of Alcami reflected several recent pharmaceutical service trends, including the influx of private equity and the expansion of chemical synthesis services into downstream functions such as finished-dose drug manufacturing. In 2016, the firm announced it would add highly-potent manufacturing with the installation of two suites that include up to 150 L of reactor capacity plus cryogenic capabilities.

Alcami, however, has been struggling to meld its various pieces together, according to one consultant who asked not to be named. Indeed, attendees at the recent CPhI North America conference identified the firm as ripe for acquisition.

“I’m not surprised,” says James Bruno, president of the consulting firm Chemical & Pharmaceutical Solutions, regarding the sale announcement. He says several companies told him that they looked at acquiring Alcami but had concerns about the efficiency of the firm’s manufacturing operations.

The acquisition may be good news for Alcami, Bruno says. “At least the group is more likely to invest and build this business.”


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