DMV-Fonterra Excipients to Acquire Indian Pharmaceutical Company

The acquisition will create a unique market position for DMV-Fonterra Excipients as the sole manufacturer and supplier of the most commonly used Diluents and Superdisintegrants to the Pharmaceutical industry.

Aug 31 2011 --- DMV-Fonterra Excipients GmbH & Co KG, the 50/50 joint venture for pharmaceutical excipients between Dutch dairy company Royal FrieslandCampina and New Zealand dairy company Fonterra, signed a business transfer agreement for the acquisition of the business and assets of Brahmar Cellulose Private Limited (BCPL) in pharmaceutical Microcrystalline Cellulose (MCC) and Sodium Carboxyl Methyl Cellulose (SCMC) as of October 2011. The acquisition will create a unique market position for DMV-Fonterra Excipients as the sole manufacturer and supplier of the most commonly used Diluents and Superdisintegrants to the Pharmaceutical industry. This, in turn, will improve DMV-Fonterra Excipients’ ability to support its customers with reducing their supply chain and formulation costs by having a consistent, single source and single quality framework across their key products.

The transaction will bring together two companies that develop, produce and market excipients to the pharmaceutical industry. Both have successfully built their own customer base, which they serve from their individual production facilities. DMV-Fonterra Excipients sources its products in Europe and New Zealand, while Brahmar Cellulose manufacturers its products in India.

“The acquisition of Brahmar Cellulose is a further step in achieving our ambition to become a leading supplier in pharmaceutical excipients and will give a stronger base for future developments in this area”, says Jan Jongsma, CEO at DMV-Fonterra Excipients. Long-term synergies will be achieved by combining DMV-Fonterra Excipient’s current global market position and sales network with Brahmar Cellulose extensive product knowledge on MCC and SCMC and market position in India. DMV-Fonterra Excipients has an established global sales network which will be able to incorporate Brahmar Cellulose product range. DMV-Fonterra Excipients will leverage its current quality and regulation framework and reputation to serve all levels of the pharmaceutical market.

“We know our customers appreciate continuity and do not like changes. Therefore current customers of BCPL can expect continuity – the same portfolio, same brands, same products from the same production locations and sales organisations. Both Brahmar Cellulose business and DMV-Fonterra Excipients Business will initially continue to operate through current sales and distribution network. Of course it is the intention to make any benefit deriving from this combination available for our customers in the future. Any changes considered will be done in close contact with our customers”, according to Willem Hoogwater, Marketing Director of DMV-Fonterra Excipients.

The legal implementation is planned to be formalised in Q4 2011 – but is subject to official approval by the Indian authorities and other approvals.

DFE is already the world’s number one supplier of lactose excipients – used in tablets, capsules and powders for medical inhalers. DFE accounts for around half of the global sales of lactose excipients and 5-10 per cent of oral tablet excipients.