October 28, 2019 PAP-Q3-19-CL-021
PharmaBioSource and PharmaBioSource Realty are committed to leveraging our broad experience in the Life Sciences sector to help our clients streamline their business activities. We provide a thorough and comprehensive suite of brokerage and pharma advisory services to help companies navigate any corporate need, from locating, acquiring and divesting prime manufacturing facilities and products to identifying M&A opportunities and investment risks and optimizing the supply chain. We have managed over 100 transactions on four continents that have included well over 15 million square feet of life sciences facilities and product and M&A deals worth over $5 billion.
We recognize that pharmaceutical and biotech real estate transactions can be complex and time-consuming.For companies looking to locate a future manufacturing facility to meet growing capacity needs, the team of Life Sciences consultants and licensed real estate brokers at PharmaBioSource leverages our extensive network of global connections to find the perfect fit. With our expert real estate and technical knowledge — as well as our in-depth industry experience — we help our clients navigate the intricacies of managing a Life Sciences real estate or M&A deal from start to finish with a smoother process, reduced timelines and less stress.
At PharmaBioSource, we have access to comprehensive databases of existing facilities and their specific capabilities; this means that we know which are currently available and which could be potential targets for transactions. Many times, the latter options are only uncovered through our network connections and are not disclosed industry-wide. As a result, we identify hidden opportunities for our clients that they would not find on their own.PharmaBioSource also provides valuation, benchmarking and negotiation support to ensure that our clients realize the best possible deals.
The entire process occurs in three broad phases. During the target identification phase, many potential facilities (sometimes as many as 50–100) that generally fit the client’s requirements are selected for further evaluation. Target profiling is then performed on those sites (usually about 10) that are determined to have the best fit. Target engagement then occurs with the few sites that appear most suitable to the client’s needs. The first two phases, target engagement, due diligence and negotiations each take approximately three months, with the whole process typically taking 9–12 months from target identification to a successful transaction conclusion, though some transactions can happen much more quickly if everything aligns.
Flamma S.p.A.’s recent acquisition of a small molecule active pharmaceutical ingredient (API) development and manufacturing site from Teva Pharmaceuticals is a prime example of the real estate transactions PharmaBioSource Realty routinely facilitates. Flamma is an Italian CDMO with many U.S. customers. The company was seeking a U.S. facility with R&D, kilo and small-scale production capabilities to better serve these clients. The company had been looking for a new location for over one year, but had not had success at finding the right site.
PharmaBioSource was aware of Flamma’s desire for a U.S. site and, in March 2019, discovered the availability of Teva’s leased 40,000-ft2Chemical Synthesis Center located just outside of Philadelphia. The site includes R&D laboratories, kilo lab suites and a cGMP pilot plant for small-scale clinical and commercial manufacture of small molecule APIs — exactly what Flamma was looking for.
In addition to finding the Teva site for Flamma, PharmaBioSource Realty provided support throughout the due diligence and negotiation stages of the deal, which was signed July 1, 2019, acting as a mediator and identifying a compromise that satisfied Flamma, Teva and the landlord.
Because Flamma’s presence in the United States before the acquisition entailed an office in Boston with just one employee, PharmaBioSource also provided start-up and logistics services to assist the company in occupying the Pennsylvania site. The security system required reactivation, IT services needed to be established, an environmental consultant had to be brought on board to handle permitting issues and financial incentives were solicited from the local and state economic development agencies.
These post-transactional services and more, such as management of renovation projects, can all be provided by PharmaBioSource to companies following a real estate purchase if they have limited resources and require additional support.
Sean McKee has over 25 years of experience in the pharmaceutical industry with proven success in the divestment and acquisition of pharmaceutical and biologics manufacturing and laboratory facilities, and has performed an extensive number of due diligence surveys. He also has significant experience in scientific research and operations as well as managing large capital projects with regard to planning, designing and construction of a variety of new laboratory facilities valued at more than $850MM. Mr. McKee holds a Bachelor of Science degree in medicinal chemistry from Ursinus College.