Australian pharmaceutical manufacturing company Mayne Pharma has completed the sale of its US retail generics portfolio to Dr. Reddy’s Laboratories for approximately $134 million.
The sale advances Mayne’s transformation into a specialty pharmaceutical business with strong branded verticals focused on US women’s healthcare and dermatology.
The transaction includes an arm’s length, 10-year supply agreement for certain products manufactured at Mayne’s facility in Salisbury, South Australia.
According to the company’s ASX announcement, Mayne received approximately USD 93.8 million (AUD 140 million), which includes approximately USD 24 million for working capital, offset by USD 21 million for accrued liabilities related to the sale of the products in the US market prior to closing.
The sale provides Mayne with up to USD 15 million (AUD 22 million) in future contingent milestone payments.
Mayne said costs for the transaction and one-time restructuring initiatives are currently being finalised but are currently expected to compromise approximately USD 1 million in transaction costs, plus between USD 6 million and USD 11 million of one-time restructuring costs.
“The divestiture of our US retail generics portfolio is yet another milestone in the transformation of Mayne Pharma into a specialty pharmaceutical company in the US women’s healthcare and dermatology markets,” said Shawn Patrick O’Brien, chief executive officer of Mayne Pharma.
“We are excited by the significant opportunities to drive operational, commercial and financial improvements across our US women’s health and dermatology businesses, as well as in our International business.”
Mayne Pharma said it is working closely with Dr. Reddy’s to ensure a smooth transition for customers.
