BASF announced the offer – which values Pronova at around €644m ($823m) - today, claiming it has the backing of the Norwegian firm’s board and shareholders including the Herkules Private Equity Fund and Kistefos Investment AS.
News of the takeover plan – which is expected to complete in Q1 next year – comes months after BASF bought Scotland-based supplier Equateq – now renamed BASF Pharma Callanish - and just weeks after it launched omega-3 as an active pharmaceutical ingredient (API) for the drug industry.
It also gained a significant share in the food-grade omega-3 market with its €3bn ($3.84bn) acquisition of Cognis in late 2010.
At CPhI in Madrid, Spain, BASF called Pronova the dominant player in the market and told in-Pharmatechnologist.com this dominance is based on existing drug products in the market sold by customers like GSK."
BASF spokesman Andres-Christian Orthofer underlined this today, telling us that: “We want Pronova to become BASF’s competence center for omega-3, while taking benefit from BASF's existing structures quickly and efficiently.”
Pronova operates two production facilities – one in Norway and one in Denmark – which are capable of producing 2,500 tons of pharmaceutical grade omega-3 a year and employs 311 people.
Orthofer told us it is too early to say how the takeover will affect Pronova, explaining that “a detailed integration plan will be developed in a discovery phase after closing.”
Amarin and GSK
Through the Equateq acquisition BASF joined Nisshin Pharma, Catalent, Chemfor and Banner Pharmacaps (currently being bought by Patheon) on the list of companies supplying Amarin with omega-3 for its cholesterol-busting drug Vascepa (isosapent ethyl).
The pill – for which Amarin received a US patent just yesterday – is widely regarded as a potential blockbuster – ie one that generates revenue of more than $1bn a year.
Amarin is due to launch Vascepa early next year, probably without the support of a Big Pharma partner given that the US Food and Drug Administration (FDA) is yet to decide whether or not to classify the drug as a new chemical entity despite approving in July.
With the Pronova acquisition BASF would be likely to retain the GSK contract according to Orthofer who said the firm will “respect contractual relationships between Pronova and its customers.”
Such an outcome would position BASF as a key omega-3 supplier for both Amarin for Vascepa and GSK for its drug Lovaza, which currently dominates the market.