The Hindu Business Line : Matrix to form joint venture with S.A.'s Aspen Pharma

MATRIX Laboratories Ltd, Hyderabad, and Aspen Pharmacare Holdings Ltd, South Africa, today executed agreements for a long-term business relationship through the joint venture route.

Consequently, Matrix will transfer one of its active pharmaceutical ingredients (APIs) manufacturing facilities, technology and intellectual property (IP) related to the manufacture of certain APIs to Astrix Laboratories Ltd, the joint venture company, for a total consideration of $36 million.

The facility, near Hyderabad, has been approved by the US Federal Drug Administration and the World Health Organisation, Geneva. Matrix expects to receive the amount on the closing date of the transaction i.e., January 1, 2006.

According to a press release from Matrix, Aspen Pharmacare will pick up a 50 per cent stake in Astrix for a consideration of $36.5 million. In turn it will be the lead supplier of anti-retroviral (ARV) APIs to Aspen. The capacity from the said facility is adequate to meet the ARV-API demand for the next few years and it offers scope for expansion.

Astrix will have the technology and expertise to manufacture the multiple synthesis complex ARV APIs and these will be further finished into dosage forms in the facilities of Aspen in South Africa.

Aspen Pharmacare is Africa's largest pharmaceutical manufacturer and a major supplier of branded and generic pharmaceutical products to the South African and selected international markets. It has a total group turnover of $461 million and net profit of $79 million for the year ended June 2005.

As part of the agreements, Matrix Laboratories will pick up a 50 per cent stake in Fine Chemical Corporation (FCC), South Africa, for an investment of $20 million, which will be paid on the closing date i.e., January 1, 2006.

FCC, currently 100 per cent owned by Aspen, has a US FDA - approved API manufacturing facility in Cape Town. With expertise in oncology and high potency APIs, it has so far filed 25 DMFs with the US FDA. The turnover of the company for the year ended June 2005 was $27 million.

FCC is an API manufacturer in South Africa and has a good customer base for its products in the US, Europe and Africa. There is no overlap between the products of Matrix and FCC.

Aspen has bagged the lion's share of the South African Government's 3-year tender finalised earlier this year for the treatment of HIV/AIDS in South Africa with 58 per cent of the volumes awarded.

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