Genzyme Completes Sale of Diagnostics Business to Sekisui Chemical Co.
Agrees to Sell Pharmaceuticals Business to International Chemical Investors Group
CAMBRIDGE, Mass.--(BUSINESS WIRE)--Genzyme Corporation (Nasdaq: GENZ) today announced that it has completed the sale of its diagnostic products business to Sekisui Chemical Co., Ltd. for $265 million in cash.
Sekisui purchased substantially all of the assets of the business, including diagnostic product lines and technologies. Genzyme's approximately 575 employees in the business were offered similar positions with Sekisui, which plans to maintain operations in each of the business's current locations. In connection with the sale, Sekisui also entered into a supply agreement to provide Genzyme with certain enzymes needed for the production of Cerezyme® (imiglucerase for injection).
Genzyme also announced today that it has entered into a purchase agreement under which an affiliate of International Chemical Investors Group (ICIG) will acquire Genzyme's pharmaceutical intermediates business.
Under the terms of the agreement, ICIG will purchase substantially all of the pharmaceutical intermediates business, excluding the drug delivery technologies portion of the business. ICIG has agreed to offer employment to the unit's approximately 120 employees upon closing, and plans to maintain operations at its primary location, a manufacturing facility in Liestal, Switzerland. The acquired pharmaceutical intermediates business will be renamed Corden Pharma Switzerland LLC and will operate as part of ICIG's pharmaceutical business within the Corden Pharma platform.
The companies' goal is to close the transaction during the first quarter of 2011. Financial terms are not material to Genzyme and were not disclosed.
As part of the agreement, ICIG will enter into a five-year supply contract to provide Genzyme with materials needed for the production of eliglustat tartrate, an investigational treatment for Gaucher disease Type 1 that is currently in phase 3 clinical trials. ICIG will also supply materials needed for the manufacture of other treatments in earlier stages of development, including neo-GAA, currently in preclinical development as a potential next-generation Pompe disease therapy.
Genzyme Pharmaceuticals develops and manufactures chemically synthesized pharmaceutical materials and technologies for the global pharmaceutical industry and focuses on lipids, peptides, carbohydrates, oligonucleotides and custom small molecules.
International Chemical Investors Group is a privately owned industrial holding company focusing on mid-sized chemicals and pharmaceutical businesses. Since inception in 2004, ICIG has acquired 15 businesses, all of which have origins in major global chemical or pharmaceutical corporations and are independently managed. ICIG companies currently employ more than 3,000 people and operate 15 manufacturing facilities in Europe and the United States. Corden Pharma group companies offer contract development and contract manufacturing for advanced pharmaceutical intermediates, APIs and drug product formulations with more than 1,500 individuals supporting their customers with specialized technologies in all international markets.
Genzyme was advised on this transaction by Young & Partners, a chemicals and life sciences investment banking firm headquartered in New York.
The terms achieved with both Sekisui and ICIG meet the three foundational goals Genzyme established for divestitures: (1) to recognize the value of employees with appropriate treatment as part of the transaction, (2) to create a future for the businesses in which customers continue to be served well, and (3) to maximize value for Genzyme shareholders.
These divestitures are part of Genzyme's ongoing effort to sharpen its focus on its key businesses. Genzyme also completed the sale of its genetic testing business in December.
One of the world's leading biotechnology companies, Genzyme is dedicated to making a major positive impact on the lives of people with serious diseases. Since 1981, the company has grown from a small start-up to a diversified enterprise with approximately 10,000 employees in locations spanning the globe.
With many established products and services helping patients in 100 countries, Genzyme is a leader in the effort to develop and apply the most advanced technologies in the life sciences. The company's products and services are focused on rare inherited disorders, kidney disease, orthopaedics, cancer, transplant, and immune disease. Genzyme's commitment to innovation continues today with a substantial development program focused on these fields, as well as cardiovascular disease, neurodegenerative diseases, and other areas of unmet medical need.
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Genzyme has filed with the Securities and Exchange Commission a Solicitation/Recommendation Statement on Schedule 14D-9 relating to the tender offer by Sanofi-Aventis. Genzyme shareholders are advised to read the company's Solicitation/Recommendation Statement on Schedule 14D-9 because it contains important information. Shareholders may obtain a free copy of the Solicitation/Recommendation Statement on Schedule 14D-9, as well as any other documents filed by Genzyme in connection with the tender offer, free of charge at the SEC's website at http://www.sec.gov. In addition, investors can obtain free copies of these documents from Genzyme by directing a request to Genzyme at 500 Kendall Street, Cambridge, MA 02142, Attention: Shareholder Relations Department, or by calling 617-252-7500 and asking for the Shareholder Relations Department.
This press release contains forward-looking statements regarding Genzyme's business plans, including the statements regarding the completion and timing of the sale of its pharmaceutical business, the expected benefits of the sale of its pharmaceutical and diagnostics businesses, its plans to divest or partner other businesses, including its cell therapy and regenerative medicine business, and the expected timing of these transactions. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in these forward-looking statements. These risks and uncertainties include, among others, the possibility that suitable purchasers or partners willing to meet Genzyme's terms for the planned transactions will not be found, that the completion of any planned transactions will not take place or will not take place within the anticipated timeframes, and the risks and uncertainties described in Genzyme's SEC reports filed under the Securities Exchange Act of 1934, including the factors discussed under the caption "Risk Factors" in Genzyme's Quarterly Report on Form 10-Q for the period ended September 30, 2010. Genzyme cautions investors not to place undue reliance on the forward-looking statements contained in this press release. These statements speak only as of the date of this press release, and Genzyme undertakes no obligation to update or revise these statements.