Full Press Release Details
ANI Pharmaceuticals to Acquire Novitium
Pharma, Strengthening R&D Engine and Expanding Generics and CDMO Business
Minnesota (March 9, 2021) - ANI Pharmaceuticals, Inc. ("ANI" or the "Company")
(Nasdaq: ANIP) today announced that it has signed a definitive agreement to acquire Novitium Pharma, a privately held, New Jersey-based
pharmaceutical company with development, manufacturing, and commercialization capabilities for $163.5 million, including $89.5
million in cash and $74 million in equity plus two potential future cash earn-outs of up to $46.5 million. The transaction has
been approved by the ANI Board of Directors and is expected to close in the second half of 2021, subject to regulatory approvals
and approval by ANI shareholders as required by Nasdaq listing standards as described below. Equity holders of Novitium have approved
our well-established Generics business with enhanced development capabilities and increased focus on niche opportunities is a key
pillar of ANI's growth strategy. The acquisition of Novitium aligns with this strategy, adding a best-in-class R&D engine
that delivers sustainable growth through new product launches and offering upside through niche 505(b)(2) opportunities. The
addition of a U.S. based, state-of-the-art manufacturing facility and enhanced scale to our CDMO business are other attractive
advantages of this acquisition. We also look forward to welcoming Samy, Chad, Vijay and the entire Novitium team to ANI,"
stated Nikhil Lalwani, President and CEO.
expect the transaction will be immediately accretive to our adjusted EBITDA. Upon closing of the transaction, our strengthened
pro forma capital structure, including the new senior credit facilities underwritten by Truist Securities and the PIPE from
Ampersand Capital Partners will enable us to facilitate long-term growth," concluded Lalwani.
Samy Shanmugam, Co-Founder and President, and Chad Gassert,
Co-Founder and CEO, commented, "We are delighted to join ANI as we enter this next phase of exciting growth at Novitium Pharma.
We look forward to supporting ANI to execute on their strategy of growing their business, expanding and diversifying their product
portfolio, and creating long-term value for their investors."
Transaction Strongly Positions ANI for Future Growth
Novitium anticipates launching 25+ additional products
in 2021 and 2022, including products with U.S. Food and Drug Administration ("FDA") Competitive Generic Therapy ("CGT")
designation. The Company currently has 21 abbreviated new drug applications ("ANDAs") filed with the FDA and more than
30 additional products under development. Novitium's leadership of Samy Shanmugam, Chad Gassert, Vijay Thorappadi and the
entire team has an excellent track record of execution and efficiency from filing to launch. Integration of Novitium's R&D
operations will establish a center of excellence for ANI's generics product development program.
Novitium is currently advancing three 505(b)(2) candidates
in Oncology and Hypertension. These 505(b)(2) products will build on ANI's increasing focus on niche opportunities,
including its first Paragraph IV filing in 2020 and the filing of injectables ANDAs in 2021.
Novitium adds nine new customers to ANI's growing
CDMO business. Additionally, Novitium brings with it a 50,000 sq ft East Windsor, NJ facility, including 27 manufacturing suites
and eight clinical suites supporting R&D, commercial manufacturing and packaging. An ongoing 20,000 sq ft building expansion
will add 18 new manufacturing suites. Novitium's annual production capacity is approximately two billion units in aggregate
across tablets, capsules, liquid suspensions and solutions, powders and powder for oral suspension, controlled release and potent
combination is expected to be accretive to ANI's adjusted non-GAAP EPS in the first 12 months after closing. The transaction
is expected to add approximately $15 million to adjusted EBITDA in the second half of 2021, assuming a mid-year 2021 close. The
acquisition diversifies ANI's revenue base by contributing to each of its reporting segments: Generics, Contract Manufacturing,
Royalties/Other and, following the launch of Novitium's 505(b)(2) pipeline products, the Brand segment.
Terms of the Transaction & Financing
the terms of the transaction, the Purchase Price of $163.5 Million is comprised of (i) a cash payment of $89.5 million
and (ii) $74 million in equity. Novitium is also eligible to receive (i) $25 million in contingent payments upon the
achievement of financial targets related to Generics products and filing of certain ANDAs and (ii) $21.5 million in contingent
payments upon the achievement of financial targets from the 505(b)(2) products.
ANI will finance the transaction with a new $300 million Term
Loan B, issuance of $74 million in equity to the sellers, and a $25 million PIPE investment by Ampersand Capital Partners. The
facility also includes a new $40 million revolving credit facility. The new debt financing will be secured by substantially all
the assets of ANI and its subsidiaries and used for the cash portion of the acquisition and to refinance ANI's existing senior
credit facilities. The proposed capital structure further facilitates sustainable growth for ANI.
The transaction is expected to be completed in the second half
of 2021, subject to the satisfaction of customary closing conditions, approval from relevant regulatory agencies, including clearance
under the Hart-Scott Rodino Antitrust Improvements Act, and approval by ANI shareholders under Nasdaq listing standards as the
result of the equity portion of the Novitum transaction and the shares issuable in the PIPE transaction.
Bourne Partners, Truist Securities and Houlihan Lokey acted
as financial advisors to ANI Pharmaceuticals. SVB Leerink acted as financial advisor to Novitium Pharma and its shareholders. Hughes
Hubbard & Reed were ANI's legal advisors and Orrick, Herrington & Sutcliffe acted as legal advisors to
Novitium and its shareholders.
Pharmaceuticals, Inc. is an integrated specialty pharmaceutical company developing, manufacturing, and marketing branded
and generic prescription pharmaceuticals. The Company's targeted areas of product development currently include narcotics, oncolytics
(anti-cancers), hormones and steroids, and complex formulations involving extended release and combination products. For more
information, please visit our website www.anipharmaceuticals.com.
About Novitium Pharma
operations in East Windsor, New Jersey, and Chennai, India, Novitium Pharma is
a U.S. based pharmaceutical company that specializes in development, manufacturing, and distribution of niche generic products.
The Company, founded in 2016, by Samy Shanmugam, Chad Gassert and Vijay Thorappadi, has
since developed a growing commercial product portfolio spanning a diverse range of dosage forms and therapeutic categories. Novitium
continues to invest in producing affordable, high-quality medication to fulfill the needs of pharmacists, patients, and communities.
About Ampersand Capital Partners
Founded in 1988, Ampersand is a middle market private equity
firm with more than $2 billion of assets under management dedicated to growth-oriented investments in the healthcare sector. With
offices in Boston, MA and Amsterdam, Netherlands, Ampersand leverages a unique blend of private equity and operating experience
to build value and drive superior long-term performance alongside its portfolio company management teams. Ampersand has helped
build numerous market-leading companies across each of the firm's core healthcare sectors. Additional information about Ampersand
is available at www.ampersandcapital.com.
Additional Information about the Proposed Merger And Where To
In connection with the proposed issuance of ANI securities
described above, the Company will file a proxy statement on Schedule 14A with the SEC. Additionally, the Company plans to
file other relevant materials with the SEC in connection with the proposed transactions described above. This release is not
a substitute for the proxy statement or any other document which the Company may file with the SEC. The definitive proxy
statement will be sent or given to the stockholders of the Company and will contain important information about the proposed
transaction and related matters. INVESTORS IN AND SECURITY HOLDERS OF THE COMPANY ARE URGED TO READ THE PROXY STATEMENT AND
ANY OTHER RELEVANT DOCUMENTS THAT ARE FILED OR FURNISHED OR WILL BE FILED OR WILL BE FURNISHED WITH THE SEC, AS WELL AS ANY
AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY BEFORE MAKING ANY VOTING OR INVESTMENT DECISION
WITH RESPECT TO THE PROPOSED TRANSACTIONS BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION ABOUT THE ACQUISITION,
RELATED MATTERS AND THE PARTIES TO THE TRANSACTIONS. The materials to be filed by the Company with the SEC may be obtained
free of charge at the SEC's website at www.sec.gov or by contacting the investor relations department of the
Participants in the Solicitation
This press release does not constitute a solicitation of a
proxy from any stockholder with respect to the proposed transactions described above. However, the Company and its directors and
executive officers may be deemed to be participants in the solicitation of proxies from Company stockholders in connection with
the proposed transactions. Investors and security holders may obtain more detailed information regarding the names, affiliations
and interests of the Company's executive officers and directors in the solicitation by reading the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 2020, the Company's definitive proxy statement on Schedule
14A for the meeting of stockholders and the other relevant materials filed with the SEC in connection with the transactions if
and when they become available. Additional information concerning the interests of the Company's participants in the solicitation,
which may, in some cases, be different than those of the Company's stockholders generally, will be set forth in the proxy
statement relating to the transactions when it becomes available. You may obtain free copies of these documents as described in
the preceding paragraph filed, with or furnished to the SEC. All such documents, when filed or furnished, are available free of
charge at the SEC's website at www.sec.gov or by contacting the investor relations department of the Company.