Speciality drug company Alliance Pharma is buying worldwide rights to two treatments from health and cleaning group Reckitt Benckiser.
Speciality drug company Alliance Pharma is buying worldwide rights to two treatments from health and cleaning group Reckitt Benckiser.
The Chippenham-based company, which earlier this year attracted buying from MW Life Science Partners and veteran investor Nigel Wray, is paying £7.5 million for the rights to Buccastem, a treatment for nausea, vomiting, vertigo, migraine and other conditions, and Timodine, an anti-fungal and anti-bacterial skin cream used to treat conditions such as severe nappy rash, eczema and other ‘dermatoses’. Last year, the two brands chalked up sales of £2.6 million, £1.6 million for Buccastem and £1 million for Timodine, and made a gross margin of £2.2 million on them.
AIM-quoted Alliance, whose directors recently affirmed their intention to pay a maiden dividend, is to pay £3.8 million cash and £3.7 million by way of a vendor share placing at 12.5p and has conditionally raised £200,000 to pay for the expenses of the brands purchase and vendor placing. If already planned variations to Timodine’s product licence needing regulatory authorisation interrupt the cream’s distribution after the sale, Reckitt Benckiser has agreed to compensate Alliance with up to £250,000.
Alliance’s chief executive officer John Dawson, who will hold a reduced 32 per cent of the shares after the placing, says Timodine will fit well with the company’s existing dermatology brands, while both brands ‘bring the potential to extend our international business’.
