BASF sitting pretty in ultrapure omega-3 market
Chemical behemoth BASF ($BASF) is sitting pretty when it comes to manufacturing ultrapure omega-3 for what is expected to be a growing area of the industry.
The company announced today that it has paid the money and closed the deal on its €684 million ($910 million) acquisition of Pronova BioPharma in Norway. Pronova makes the active ingredient for GlaxoSmithKline's ($GSK) blockbuster omega-3 drug, Lovaza. Pronova has manufacturing facilities in Norway and Denmark.
"The intended acquisition will significantly strengthen our position in the fast-growing and highly profitable market for omega-3 fatty acids. We want to combine the global market reach and experience of BASF with the know-how of Pronova in omega-3 fatty acids," Michael Heinz, a BASF board member, has said. With the acquisition, BASF says the deal will allow it to leap to the head of the line in global production of highly concentrated omega-3 fatty acids.
BASF has also invested €22m ($29.2 million) to expand a plant in Isle of Lewis in the Hebrides, west Scotland, that it acquired in May from Equataq. BASF increased capacity there from 20 metric tons to 250 metric tons.
The moves have already paid off. Amarin ($AMRN), whose ultrapure omega-3 fatty acid heart pill Vascepa was approved last year by the FDA, is seeking to have BASF approved by the FDA as one of the API manufacturers. Amarin has yet to launch Vascepa but said it is building a manufacturing network to meet expected demand.
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