The Challenge

Following the completion of its acquisition of Pharmacia, Pfizer Inc. concluded that its manufacturing facility in Caguas, Puerto Rico, was no longer required in its plant network.  Pfizer retained PharmaBioSource to serve as consultants and brokers to assist in the divestiture of its the Caguas plant.

The 487,000 SF plant was viewed by Pfizer and PharmaBioSource as a significant asset to a potential buyer, both because of the manufacturing capabilities of the facility and the expertise of its employees.  As an additional benefit to a potential acquirer, Pfizer was willing to provide a substantial trailing supply agreement to assist the buyer with the absorption of facility costs while the acquirer moved its own products to the plant.

At the time of sale, the Caguas plant possessed the following capabilities:

• Extensive and diverse oral products manufacturing capabilities, including both wet and dry granulation, liquid product formulation, tableting and encapsulation, and both active and inactive tablet coating, producing a broad range of products, including products requiring high containment, oral contraceptives, controlled-release technology, DEA-controlled substances and a variety of small-volume specialty products.
• Modern packaging facilities including solid dosage bottle packaging, liquid bottle packaging including nasal spray capabilities, blister packaging with integrated cartoning, including hospital unit dose capabilities, and foil pouch packaging.
• Laboratory and Support Facilities: Modern, well-equipped laboratories (providing extensive technical process development and new product introduction services) in addition to substantial warehousing facilities and normal support services including utilities, wastewater treatment, and administration offices within the facility.

At the time of the sale of the Caguas plant, the site employed 124 colleagues and was projected to generate trailing supply agreement revenues of $13.5M to Pfizer in the first full year after the close of the transaction.

The Solution

To help Pfizer Inc. achieve its goal of divesting the Caguas plant, PharmaBioSource engaged with Pfizer in the development of the marketing strategy, a target list of prospective buyers and an assessment of the type of value proposition that would attract interest from the types of companies that Pfizer was seeking as potential buyers.

PharmaBioSource utilized its extensive experience in consulting and advisory services to partner with Pfizer, with the outcome being the successful sale of the facility to Neolpharma, a respected Mexican generic drug manufacturer.

Services provided by the PharmaBioSource team:

• • Business and Site Assessments
  • Value Proposition Creation
  • Prep for Sale
  • Benchmarking
  • Non-confidential marketing collateral
  • Target Identification and Marketing
  • Prepared Confidential Information Memorandum (CIM)
  • Contract Documents
  • Deal Structure and Negotiations
  • Closing

The Results

Although the process took in excess of 18 months to complete, Pfizer was able to complete the transaction with a company that was committed to the future success of the site and its employees and one that provided Pfizer with the necessary level of comfort that its trailing supply needs would be fulfilled in a high quality, timely and cost-effective manner.