Hospira to acquire Orchid API production and R&D facility

US injectable generic drugs specialist Hospira (NYSE: HSP) has reached an agreement to acquire an active pharmaceutical ingredient (API) manufacturing facility, together with an associated R&D facility from India’s Orchid Chemicals & Pharmaceuticals (BSE: 524372), for around $200 million.

Acquisition of the modern, US Food and Drug Administration-approved facility is expected to reduce Hospira's costs, support continuity of supply of key antibiotic products and pave the way for future API development. Hospira previously acquired Chennai-based Orchid Chemicals generic injectable-drugs business for $400 million in 2009 (The Pharma Letter December 16, 2009).

"Our decision to acquire Orchid's world-class API facility demonstrates Hospira's continued dedication to the antibiotics space, enhancing cost-competitiveness and ensuring continuity of supply," said Bhaktavatsala Rao, managing director, Hospira India. "This is a top-of-the-line API manufacturing facility that has been recognized by industry leaders for its high standards," he added.