RxElite Announces Acquisition of Assets of FineTech Laboratories
MERIDIAN, Idaho, January 10, 2008 /PRNewswire-FirstCall/ -- RxElite, Inc. , a developer, manufacturer, and marketer of specialty generic prescription drug products, announces today its acquisition of the business and assets of FineTech Laboratories Ltd. (FineTech), located in Haifa, Israel, for $6.2 million in cash and 18,632,383 shares of RxElite common stock. Combining the ability to develop and manufacture complex active pharmaceutical ingredients with RxElite's robust generic manufacturing and distribution capability is a major step for RxElite.
Jonathan Houssian, CEO and founder of RxElite gave these key points of the acquisition:
-- The acquisition is expected to be accretive to earnings this year. FineTech achieved revenues of approximately $6 million in and 2007, with strong profitability, -- The combination of the two companies will significantly expand the new product pipeline of RxElite, -- There are immediate opportunities to grow RxElite and FineTech's business over the next 12 months by leveraging RxElite's relationships and FineTech's product development capabilities, -- RxElite believes that its acquisition of FineTech brings deep scientific capabilities to develop new complex generic drugs at a relatively low cost, and -- By taking this step towards vertical integration in the area of product development, RxElite can maintain the strong focus of its sales, marketing and distribution team on successful market penetration for Sevoflurane, Isoflurane, and the next anesthetic gas product that it expects to launch in 2009.
"There are tremendous synergies for both companies both short and long term," continued Mr. Houssian. "The acquisition immediately expands our domestic and worldwide opportunities to develop and profitably launch complex generic drugs. A key part of FineTech's business model has been to develop very difficult Active Pharmaceutical Ingredients (APIs), selling and licensing them to major U.S. generic companies. FineTech's business model has resulted in several successful generic drug launches and significant profits for FineTech's partners over the last five years. RxElite plans to vertically integrate FineTech's business in order to capitalize on these type of profitable opportunities from FineTech's 5 current products, as well as their 6 complex APIs under development."
RxElite has acquired the physical facilities, the intellectual property and patents of FineTech and has retained all FineTech employees. FineTech's team of 29, including 20 Ph.D. level scientists, conducts proprietary research and development and manufactures complex APIs at its state-of-the-art manufacturing facility in Israel. This facility operates in compliance with U.S. Food and Drug Administration's current good manufacturing practices (cGMP) standards. FineTech successfully passed its first FDA inspection in October 2004.
"My colleagues and I are very excited to join in the vision of RxElite and look forward to the opportunities and challenges that await us," said Dr. Arie L. Gutman, President and Founder of FineTech. "We expect that our demonstrated ability for the synthesis of complex APIs will make us a very productive and highly valued contributor to RxElite as a newly combined business."
FineTech will operate as a separate division, through a wholly owned subsidiary of RxElite, and will provide immediate chemical synthesis, API development capabilities, and strategic opportunities to RxElite. FineTech will continue to actively work with current outside customers and to pursue development of new customer relationships for their services.
RxElite used proceeds from its recent senior convertible debt financing to complete the acquisition.
FineTech was founded in 1990 by Dr. Arie Gutman. FineTech specializes in the production of high value, low volume APIs for the pharmaceutical industry and in collaborative R&D work and process development. The company possesses proprietary technology and confidential expertise in several important and unconventional areas of organic synthesis. FineTech operates in a 35,000 sq. feet, 6 building campus facility, equipped with state-of-the-art laboratory, production and quality control equipment.
About RxElite, Inc.
RxElite, Inc. develops, manufactures, and markets generic prescription drug products in specialty generic markets. These markets include products in the areas of anesthesia, sterile liquid dose drugs (including respiratory inhalation drugs, ophthalmics, and injectable drugs), and transdermal patch products.
Safe Harbor Statement
Statements in this press release that are not statements of historical or current fact constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, involving known and unknown risks, delays, and uncertainties that may cause RxElite's actual results or performance to differ materially from those expressed or implied by these forward-looking statements. These risks, delays, and uncertainties include, but are not limited to: risks associated with the uncertainty of future financial results, RxElite's reliance on its sole supplier, RxElite's ability to successfully integrate the operations of FineTech, the limited diversification of RxElite's product offerings, additional financing requirements, development of new products, government approval processes, the impact of competitive products or pricing and technological changes Additional risks and uncertainties are set forth from time to time in RxElite's filings with the United States Securities and Exchange Commission, including Amendment No. 1 to its Registration Statement on Form SB-2/A filed December 31, 2007, which are available on the Commission's website at http://www.sec.gov. All forward-looking statements included in this release are made as of the date of this press release, and RxElite assumes no obligation to update any such forward-looking statements.
Contacts: Corporate Information Ph: (208) 288-5550 Toll Free: (800) 414-1901 Fax: (208) 288-1191 Investor Relations Charlie Forshee, 215-885-4981 Segue Ventures LLCinvestorrelations@rxelite.com
CONTACT: Corporate Information of RxElite, Inc., +1-208-288-5550, TollFree, 1-800-414-1901, Fax, +1-208-288-1191; or investors, Charlie Forsheeof Segue Ventures LLC, +1-215-885-4981, , forRxElite, Inc. email@example.com
Web site: http://www.rxelite.com/
Ticker Symbol: (NASDAQ-OTCBB:RXEI),(NASDAQ-OTCBB:RXEI)
Terms and conditions of use apply
Copyright © 2008 PR Newswire Association LLC. All rights reserved.
A United Business Media Company
Posted: January 2008