Synovics acquires Kirk Pharmaceuticals

Synovics Pharmaceuticals, a US developer, manufacturer and marketer of oral, controlled-release generic drugs and improved formulations of previously approved drugs, has raised US$21.25m in finance, enabling it to complete the previously announced acquisition of Kirk Pharmaceuticals and its affiliated company ANDAPharm.

Phoenix-based Synovics purchased 100% of Kirk for $12m, including $9m in cash and $3m in debt. Kirk, a manufacturer of over-the-counter (otc) and generic drugs based in Ft. Lauderdale, Florida, had revenue of approximately $14.6m for the year ended October 31, 2005.

The financing raised by Synovics included $4.75m in convertible debt, $6.0m in common stock purchased at $4.00 per share by Maneesh Pharmaceuticals PVT of Mumbai, India and $10.5m of five-year debt priced at prime plus one provided by the Bank of India. Maneesh is among the fastest-growing pharmaceutical companies in India. Headquartered in Mumbai, it has manufacturing, domestic and international marketing and r&d capabilities for conventional therapies and novel drugs.

Ronald Howard Lane, chairman and ceo of Synovics Pharmaceuticals, said in addition to funding the acquisition of Kirk, the finance would provide capital to accelerate development of its generic drug pipeline and create a strategic relationship with Maneesh Pharmaceuticals. "We have high expectations for Kirk, not only as a developer and manufacture of our generic and 505(b)(2) drugs, but also in the development and sales of their otc and prescription products. The new strategic relationship with Maneesh offers many potential r&d, manufacturing and marketing synergies, and we are extremely pleased with their investment in our future."

Kirk manufactures otc and generic prescription drugs at its 70,000 sq ft manufacturing facility and markets several otc solid-dose and soft-gel pharmaceutical products.