Actavis will invest €50 mil. ($65.9 mil.) in Abrika Pharmaceuticals and add 60 employees to the four-year-old Fort Lauderdale, Fla. company's 40-person staff in 2007 to bolster development of generic controlled-release products for the U.S. market, Actavis CEO Robert Wessman told analysts during a Nov. 30 call.

Reykjavik, Iceland-based Actavis purchased privately held Abrika for an up-front payment of $110 mil. and the possibility of another $125 mil in milestone payments over the next three years, the company said. Wessman said the bulk of the payment is in milestones because Abrika is a young business with a "rich pipeline."

Milestone payments will be triggered by a minimum gross profit of €15 mil. ($19.8 mil.), with an additional €11 mil. if targets are met or exceeded "just in the period 2007-2008." The deal is expected to close in January 2007.

During the call, Wessman highlighted the "advanced generics" market, which includes modified and controlled-release products, as one of Actavis' focus areas. Abrika's pipeline and portfolio has potential synergies with Actavis' interest in expanding its advanced generics presence in the long term.

Abrika's technology pipeline includes transdermal, transmucosal and immediate-release oral delivery technologies. However, Actavis' initial goal following the acquisition is to establish a "center of excellence" for controlled-release products, starting with the €50 mil. investment in Abrika's controlled-release development efforts.

The Florida pilot plant is gearing up to add manufacturing capabilities, Wessman said, adding that the manufacturing facility is being validated and should be operational next year. Actavis also has U.S. manufacturing capabilities in its Elizabeth, N.J. plant.

Abrika has filed nine ANDAs, with two products expected to be granted first-to-file exclusivity, according to Actavis, which projects that the Florida company has the ability to file 5-7 ANDAs a year.

Actavis announced earlier in November that it had purchased a majority share in Russian pharmaceutical manufacturer ZiO Zdorovje (¹ Also see "Actavis Acquires Majority Stake In Russian Drug Manufacturer" - Pink Sheet, 21 November, 2006.). Earlier this year, the company lost a bidding war for Croatian generic manufacturer Pliva to Barr (² Also see "Door Opens For Barr To Acquire Pliva As Actavis Bows Out Of Bidding War" - Pink Sheet, 18 September, 2006.).

-Shirley Haley (s.haley@elsevier.com)

Actavis Acquires U.S. Generics, Delivery Technology Firm Abrika

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