NEWS
Sanofi to give help to restructure EuroAPI
French-based CDMO EuroAPI has reached an agreement with Sanofi to finance the implementation of its Focus-27 restructuring programme through a € 200 million perpetual subordinated hybrid bond . Sanofi , from which EuroAPI was originally spun out , remains its main shareholder and customer . It also agreed in principle to reserve minimum available capacities for selected products manufactured by EuroAPI through a € 54 million payment .
Under Focus-27 , which was revealed in February after a “ comprehensive analysis of the company ’ s operational strengths and weaknesses ”, EuroAPI aims to “ improve competitiveness and unlock sustainable and profitable growth by refocusing on high-value and growing market segments ” over the course of four years . This will involve :
• Streamlining the portfolio to focus on the most profitable APIs , while discontinuing 14 with net sales of about € 80 million / year
• Focusing the CDMO offer on late-stage , highvalue , complex small molecules and ‘ tides ’
• Divesting sites at Haverhill , UK , and Brindisi , Italy , where operations are currently suspended following revelations of local malpractice , thus raising capacity utilisation at the remaining four from 6 % to 80 %
• Investing € 350-400 million on strategic initiatives in areas of focus , notably large molecules , Vitamin B 12
, prostaglandins , corticosteroids , hormones and opiates The company aims to generate € 75-80 million in annual run rate incremental core EBITDA by the end of 2027 but will incur restructuring costs of about € 110-120 million , not including the divestments . In addition to Sanofi ’ s aid , it is in discussions with its banks to amend the terms and extend the duration of the € 451 million revolving credit facility it signed in 2022 .
More positively , EuroAPI is among 13 EU companies , including Sanofi , that will receive funding from the European Commission under the first Important Project of Common European Interest ( IPCEI ). IPCEI Med4Cure aims to foster the resilience of the EU health industry by enhancing drug discovery , in particular for unmet medical needs , and developing more sustainable processes for pharmaceuticals .
In all , member states will provide up to € 1 billion in public funding . This is expected to unlock € 5.9 billion more in private funding . EuroAPI will use the funding to :
• Reshore production of macrolide antibiotics for the treatment of infectious diseases to its Saint- Aubin-lès-Elbeuf site
• Develope new processes and technologies for corticosteroids at its Vertolaye site
• Increase the bioavailability of finding new therapeutic applications for the APIs using nanoparticles , also at Vertolaye The French government and EuroAPI are now beginning discussions to prepare the contractual agreement for the granting of public aid within the framework of the France 2030 programme .
Separately , EuroAPI has announced a five-year development and manufacturing agreement with Irish biotech Priothera . Under this , it will develop and industrialize the manufacturing process of mocravimod , a S1P1 receptor modulator being developed as an adjunctive and maintenance treatment for blood cancers , at its Budapest site .
Earlier , EuroAPI signed an agreement with an unnamed global animal health company , under which it will contract manufacture “ a key veterinary product ” from 2025 to 2029 . The contract is expected to be € 130-150 million in total . EuroAPI supplies hormones , prostaglandins and complex synthesis molecules , among other things , for animal health .
6 SPECIALITY CHEMICALS MAGAZINE ESTABLISHED 1981