Axcan to acquire France's Lacteol

Axcan Pharma of Canada has signed an agreement to acquire all of theshares of France's Laboratoire du Lacteol du Docteur Boucard SA, located in Houdan, a suburb of Paris. Under the terms of the deal, Axcan will pay $12.6 million, $7.6 million of which will be paid in cash and the remainder either in cash or common shares, at the discretion of the company. The transaction is due to close by the end of April.

Lacteol had revenues in excess of $10 million in 2001, and was "marginally profitable." Its main product, Lacteol Fort, is indicated for the treatment of diarrhea and is marketed using a contract sales organization with 70 medical representatives. Axcan intends to merge Lacteol with Laboratoires Enteris, a recently-acquired firm which specializes in the distribution of gastrointestinal products (Marketletter November 5, 2001), and believes that, with over $20 million in revenues, the combined operations will be accretive going forward.

Commenting on the deal, Axcan's chief executive, Leon Gosselin, said that the acquisition of Lacteol, along with that of Enteris, will help the firm establish profitable operations in France. It will now have a single coordinated sales force in France and "we will also benefit from this transaction by completing our management team and strengthening our distribution channels in western Europe,'' he concluded.