Nycomed
Investment summary
Fund: Fund III, Fund V and Fund VI
Investment theme: Emerging markets growth, structural
transformation and strategic re-positioning
Investment date: May 1999 (Fund III), May 2005 (Fund V) and
December 2006 (Fund VI)
Exit date: December 2002 (Fund III) September 2011 (Funds V
and VI)
Business description
Nycomed is a leading European-based specialty
pharmaceutical company, which ranks among the top 30 pharmaceutical
companies and is 15th in the world's over-the-counter market. It
has direct market presence in Europe, CIS, Latin and North America.
Production takes place mainly in Western and Eastern Europe with
significant low-cost production in Poland and China. Nycomed has a
strong market position in emerging markets - >40% of revenues in
2010.
Background
Nordic Capital Fund III owned Nycomed between 1999
and 2002, during which time the company was established as a
stand-alone pharmaceutical company focusing on in-licensing
products for its core markets, mainly northern Europe. Under this
period, Nycomed restructured its manufacturing operations, boosting
efficiency and capacity, and improved the licensing program for new
products. In 2002, Nycomed was sold to a group of investors led by
CSFB Private Equity.
In 2005, Nordic Capital Fund V acquired a major
shareholding in Nycomed to support a growth strategy based on new
products and increasing the presence in emerging markets.
In 2007, Nycomed focused on the integration of ALTANA
Pharma, acquired in late 2006. The headquarters were moved from
Denmark to Switzerland. Nycomed also acquired Bradley
Pharmaceuticals Inc. in the United States in February 2008.
Investment rationale
When Nordic Capital re-entered as an investor in May
2005, Nycomed was a very well positioned company with many
promising products to be launched in the coming years, enabling
strong revenue and profit growth with a very strong management team
which Nordic Capital was familiar with.
Nycomed was well placed to pursue the objective of
becoming a pan-European specialty pharma company, after having
strengthened its presence across Europe and successfully signed key
in-licensing deals. Strong growth was expected with the financial
outlook underpinned by new product launches and exposure to growing
markets.
Value added
Nordic Capital supported the transforming acquisition
of Altana in December 2006 with new capital from Funds V and VI.
Through this key event, which saw Nycomed acquire a company
substantially bigger than itself, Nycomed obtained global
operations and an interesting R&D pipeline, as well as making
substantial synergies. It created a new growth paradigm, with a
clear focus on emerging markets and leveraging key products,
including the potential blockbuster drug Daxas.
Throughout the 10 years that Nordic Capital's funds
were the main owner - of in total 12 years of private equity
ownership - Nycomed enjoyed significant organic growth, made
several major achievements, including execution and integration of
add-ons (e g Altana, Bradley Pharmaceuticals), streamlining of
operations and the implementation of a two-pronged sourcing
strategy.
Exit
In May 2011, Nycomed was sold to the Japanese
pharmaceutical company Takeda for €9.6bn, excluding the US based
dermatology unit, now renamed Fougera Pharmaceuticals. The deal
represented the largest private equity trade sale in Europe and
third largest globally to date; the largest capital gain for
private equity investors globally to date; and the second biggest
foreign acquisition by a Japanese company.
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