FLINT — Diplomat Pharmacy Inc. (NYSE: DPLO), the nation’s largest independent specialty pharmacy, said Thursday it has an agreement to acquire a smaller specialty pharmacy, Cincinnati-based BioRx LLC.
The companies said the transaction requires regulatory review and is expected to close by March 31.
Under the agreement, Diplomat will purchase BioRx for $210 million cash and $105 million in Diplomat common stock upon the closing of the transaction. The transaction will provide Diplomat with an expected future tax benefit of approximately $50 million.
Under the terms of a one year contingent earnout, BioRx can earn an additional $35 million in Diplomat common stock upon achieving a set level of earnings before interest, taxes, depreciation and amortization.
In 2014, BioRx generated approximately $227 million in revenue and $23 million in EBITDA.
The transaction is expected to be accretive to Diplomat’s earnings per share in the first full year following the closing of the transaction.
Diplomat said the acquisition broadens its product offerings and makes Diplomat one of the nation’s top specialty infusion providers.
Said BioRx co-founder Phil Reilly: “Since we started BioRx in 2004, our goal has been to build the country’s most patient-centered specialty pharmacy that focuses on chronic and complex therapies. Diplomat shares this focus and represents the right partner, at the right time, for us to continue our mission into the future.”
Added Diplomat chairman and CEO Phil Hagerman: “The combined resources of both companies will make us much stronger and unique within the infusion services industry, The specialty pharmacy market has evolved substantially over the last decade and this partnership will help Diplomat be even more prepared to grow and thrive in the years to come.”
The companies said both BioRx co-founders, Phil Rielly and Eric Hill, have made multi-year commitments to help lead the combined organization going forward.
In connection with the pending transaction, Diplomat has obtained committed financing from GE Capital, the agent under Diplomat’s existing revolving line of credit. Subject to market conditions, Diplomat expects to fund the cash component of the purchase price with the financing led by GE Capital along with cash on hand.
To learn more, visit www.biorx.com. More about the transaction at this link.
BioRx is a highly specialized pharmacy and infusion services provider that provides treatments for patients with ultra-orphan and rare, chronic diseases. In addition to pharmacy and infusion services, BioRx also serves health plans and payer organizations with comprehensive data analytics and outcomes reporting. The company’s clinical staff reaches patients in all 50 states and operates dispensing facilities in Ohio, Massachusetts, North Carolina, Iowa, Minnesota, Arizona and California.
Diplomat also serves patients and physicians in all 50 states. Founded in 1975, the company focuses on medication management programs for people with complex chronic diseases, including oncology, immunology, hepatitis, multiple sclerosis, HIV, specialized infusion therapy and many other serious or long-term conditions.
More at www.diplomat.is.