Riemser Arzneimittel AG (Germany) - Dec 2007

unquote
01 December 2007

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Munich and Boston-based TVM Capital has invested in mid-sized pharmaceutical company Riemser Arzneimittel AG, and now holds 10% of the company’s shares. Supported by the current management, TVM Capital plans to help transition and grow Riemser Arzneimittel into a more international corporation and further specialise the product portfolio. Expansion will focus on Western Europe, Asia, as well as the Americas. The investor will also provide assistance with its network and experience in the global pharmaceutical industry. Previously, NORD Holding invested in the framework of a ‘stille Beteiligung’ (silent partnership) in the third quarter of 2005.

The investment is part of TVM Capital’s strategy to invest also in more mature life sciences enterprises with interesting growth perspectives. These are determined by the market trend of increased pressure on prices for pharmaceutical drugs, which sees the big pharma players respond either by moving more towards high end innovation and increased allocation to R&D, or produce more cost-efficient generics and shed those more specialised products from the product portfolio, which are not either global or below certain sales thresholds. Niche players such as Riemser are expected to capitalise from the long tail of the industry and by manoeuvring in specialists care segments.

To the investor, Riemser was of particular interest due to its strong position in several niche markets. The funding will go towards acquiring products in the company’s fields of expertise and towards developing selected products in the company’s own late stage pipeline.

Company

Riemser Arzneimittel AG develops and produces a line of dermatology, cardiovascular and antiinflammatory, oncology and dental care pharmaceuticals. It is headquartered close to Greifswald on the island of Riems in Mecklenburg-Vorpommern, Germany, and is owned and controlled by the Braun Family. The 450 employees at four manufacturing plants generated annual revenues in 2006 of about E56m. Research partners include the Medical Faculties Institute of the University of Rostock and Greifswald as well as the Friedrich-Loeffler-Institute Insel Riems (FLI).

People

Dr Christoph Schröder, partner of TVM Capital and former management executive of BASF Pharma, handled the transaction and joins the board of directors. Norbert Braun is the CEO of Riemser Arzneimittel AG.

Advisers

Company - Mäger von Bernuth, Stefan Mäger (Legal)Equity - Altium Capital, (Corporate Finance)Equity - Ernst & Young, (Financial Due Diligence)Equity - Linklaters, (Legal)

Sourced from: Deutsche unquote" 95 (Feb 2008)