Alliance Pharma, the Chippenham-based speciality pharmaceutical group, has expanded its portfolio by paying £2.4m to acquire the UK marketing rights to six products from Beacon Pharmaceuticals.
In the year to April 30 the products had total sales of approximately £2m and gross margin of £900,000, mainly from severe acne treatment Rizuderm (isotretinoin) which fits well in Alliance’s dermatology business.
Alliance chief executive John Dawson said: “This acquisition is immediately earnings enhancing and is a valuable addition to our dermatology portfolio. We continue to evaluate further acquisition opportunities to complement our organic growth.”
Alliance is funding the cash acquisition by drawing a loan from the £20m revolving credit facility put in place last November 2010 to fund acquisitions.
The acquisition was announced at the same time as Alliance’s results for the six months to June 30, which showed pre-tax profits up by £1m to £7m on the equivalent period last year on sales also up by £1m at £24.4m.
Stripping out slowing sales of its Deltacortril gastro-resistant tablets, underlying sales growth was 29%.
Mr Dawson added: “Alliance's results for the first half of 2011 have inevitably been impacted by the slowdown in Deltacortril sales. But more importantly, they also confirm that the Deltacortril profits that we have enjoyed during the past two years have been put to good use.
“We have invested in expanding our brand portfolio while also reducing debt. As a result, the business is now stronger than ever. Our dermatology and oncology portfolios are both growing well. Indeed, excluding Deltacortril, over the past five years the whole business has grown at an annual average of 21%, of which 6% is organic and around 15% is from acquisitions.”
Shareholders will receive an interim dividend up 47% to 0.25p a share.
