Jubilant News for Hollister-Stier
By Joanna Cosgrove
In what’s been billed as the largest overseas acquisition in contract manufacturing sector by an Indian company, Hollister-Stier Laboratories LLC, a Spokane, WA-based contract manufacturer of sterile injectable vials and lyophilization products, was acquired by Jubilant Organosys Ltd., an integrated pharmaceuticals industry player and one of the largest Custom Research and Manufacturing Services (CRAMS) and Drug Discovery and Development Services companies out of India. The purchase price was $122.5 million, with an additional $16 million in capital commitments that will reportedly be put toward the completion of a $30 million, 50,000-square-foot plant expansion begun last year at Hollister-Stier’s 20-acre campus, and a second production line.
According to Jubilant, the acquisition delivers “a meaningful platform within the fast growing Injectables Contract Manufacturing segment,” while fulfilling Jubilant’s goal of focusing on products and services that are considered high value and thereby command premium pricing. What’s more, the addition of sterile injectables contract manufacturing enhances Jubilant’s ability to provide "one-stop shop" capabilities to customers and substantially increases size and scope of its CMO business.
Hollister-Stier, one of the leading North American immunotherapy and vaccine companies, also has a well-recognized Allergy Extracts and Products business, which is the second largest in the USA. Anthony Bonanzino, Ph.D., president and CEO of Hollister-Stier, recently spoke with Contract Pharma and offered some interesting insights about the acquisition.
Contract Pharma: Why was this venture with Jubilant the right move for Hollister-Stier?
Anthony Bonanzino: Hollister-Stier experienced a tremendous growth rate over the past eight years; fully supported by its private equity partner, Windward Capital Partners. Hollister-Stier was looking to expand its capabilities and rapidly increase the size and scope of its injectable CMO business. To best accomplish this objective we required a strategic partner with financial and process capabilities that enhanced ours. Jubilant met all of these requirements and presented an entrepreneurial philosophy similar to that of Hollister-Stier.
CP: What does Jubilant bring to the table in this market? How will this acquisition impact the industry?
AB: Jubilant is a world-class organization in the CMO space and has a deep portfolio of major client relationships. Their existing clients provide early-stage opportunities that potentially enhances our long-term client base. This acquisition provides current and future Hollister-Stier clients the ability to perform all work under “one roof.” This conceptually translates to faster execution of projects and leads to earlier approval times; ultimately benefiting the market and patients in need.
CP: What sorts of progressive changes do you expect Jubilant to make?
AB: We foresee several areas of positive change as the new relationship moves forward:
- Hollister-Stier will immediately begin to leverage Jubilant’s portfolio of customer relationships. This activity will lead to a more rapid expansion of filling any unused capacity. Additionally, our current clients will now have access to significantly greater technical resources in the areas of methods development and process development.
- The company plans to accelerate business growth via new investment opportunities, e.g. commercial-scale pre-filled capabilities.
- Hollister-Stier will continue to work on cost improvements and improved capacity utilization thus improving the cost/benefit ratio for our clients.
CP: What does this acquisition say about the growing involvement of Indian companies in western markets?
AB: I believe Indian companies will continue to execute a competitive position in western markets and leverage their technical competence and strong financial position. It is important for everyone to realize that we exist in a strong global marketplace and no country has a monopoly on the world market. Organizations demonstrating flexibility and a tenacious entrepreneurial spirit will be the leaders in the next decade. Indian companies will team up with those organizations having a longer term vision who possess a sustainable philosophy of quality performance; not only for shareholders, but for employees and patients as well.