- Mallinckrodt will sell its nuclear imaging business to IBA Molecular, a subsidiary of the French IBA Group, for $690 million, the British specialty pharma company said Wednesday.
- As part of the deal, ownership of two Mallinckrodt manufacturing plants in Maryland Heights, Missouri and Petten, the Netherlands will be transferred to IBA Molecular, along with the approximately 800 workers employed at those sites.
- By divesting the business, Mallinckrodt hopes to sharpen its focus on the specialty pharma space.
IBA Molecular, which produces radiopharmaceutical products, will pay $574 million up-front, in addition to assuming $39 million in long-term obligations and $77 million of contingent consideration.
While the business is a profit-generating unit for Mallinckrodt, the British company is prioritizing its specialty pharmaceuticals efforts.
Mallinckrodt currently has 14 marketed pharmaceutical products and two dozen others in development. The specialty pharma has an expertise in reformulations, including abuse-deterrent formulations and nano-particle encapsulations.
In addition to its diagnostic nuclear imaging products, Mallinckrodt is also a global supplier of the medical isotope technetium-9m, which is used in approximately 80% of nuclear medicine procedures worldwide, according to the company.
Around two-thirds of revenues from the nuclear-imaging business are generated in the U.S.
IBA Molecular will take over Mallinckrodt's plants in Maryland Heights, Missouri and Petten, the Netherlands, which are used to produce nuclear medicine products and in sterile-fill pharmaceutical manufacturing.
Given its nuclear component, the deal will have to be approved by the U.S. Nuclear Regulatory Commission along with the standard anti-trust reviews. The companies expect to close the transaction in the first half of 2017.