Procaps Group Acquires 1st U.S.-Based Softgel Production Facility and Pharmaceutical R&D Center to Expand Global Growth of its iCDMO Business Unit
Top 5 Global Producer of Pharmaceutical Softgels to Expand Production Capacity in the United States by 1.8 Billion Capsules Annually
USFDA Approved 86,000 Square Foot Facility Located in West Palm Beach, Florida to Accelerate Time-To-Market Response & Lower Cost of Distribution to the North American Market
Procaps Group (NASDAQ: PROC), a leading integrated international healthcare and pharmaceutical company, today announced the closing of an asset purchase agreement to acquire an 86,000 sq. ft. pharmaceutical production facility located in West Palm Beach, Florida with production capacity of approximately 1.8 billion capsules per year for its iCDMO (integrated Contract and Manufacturing Organization) business unit, and is expected to increase Procaps Group’s product development capabilities by more than 70% .
The soft gelatin capsule (“Softgel”) is a solid dosage form composed of two gelatin films that contain semisolid or liquid active pharmaceutical ingredients (APIs) protected by an external, hermetically sealed cover. Softgels are designed to deliver high precision dosage by achieving homogeneity of ingredients. The Softgel capsules are well recognized in the supplement, OTC, and the prescription market for improving patient adherence to the drug and therapy by facilitating swallowing due to the texture of its shell.
The pharmaceutical production facility was purchased from Strides Pharma, Inc., a U.S. subsidiary of the Indian-based pharmaceutical corporation, the Strides Group. The facility is USFDA (United States Food and Drug Administration) approved and, in addition to the manufacturing capabilities, it offers development and analytical testing capacities, which we believe will become an important alternative for new pharmaceutical and OTC developments in highly regulated markets worldwide. Core assets included in the acquisition were several Softgel encapsulation lines, new critical support systems, automated packaging line capabilities, as well as development facilities including pilot and scale up capabilities. Procaps Group expects the facility to begin operations in May of 2022.
“This acquisition is an important milestone for our strategy of bringing soft gelatine-based innovations to all corners of the globe both via integrated CDMO solutions and our own developments,” said Ruben Minski, CEO of Procaps Group. “This facility has a strong production track record and audit history and we believe it will become a Global Center of pharmaceutical excellence. We are privileged to welcome the current facility employees into the Procaps Group family. Operationally and strategically, this expansion is an important investment for us. We believe the estimated increase in production capacities will provide us the opportunity to deliver a wider product array as we move even closer to our customers in the North American markets and to implement our ambitious global growth plans.
“This significant, long-term investment in both our manufacturing and R&D infrastructure underscores the commitment of our corporation to deliver better health and nutrition to the world through Innovative oral delivery systems. We believe our expansion to the U.S. will provide us a wider capability of delivering our pharmaceutical products to our strategic partners and ensuring the continued quality of their most valued asset, their brands.
Minski added, “We believe our new facility in Florida is strategically positioned to improve our supply chain efficiency and the cost of distribution for our products in terms of proximity to customers, especially for the NAFTA area, the largest pharmaceutical market worldwide. We anticipate that new product innovation will also be fueled by our proximity and the ability for frequent dialogue with new customers. Moreover, we believe we can now offer a new and flexible alternative to our CDMO customers in North America and provide them better access to our innovative technologies for oral delivery systems. With this facility having the capability of complying with the regulatory standards of several regulators worldwide, we expect new European and Australian customers will also show interest in having this facility develop and supply products and solutions for their own markets.”
About Procaps Group Procaps Group is a developer of pharmaceutical and nutraceutical solutions, medicines, and hospital supplies that reach more than 50 countries in all five continents. Procaps has a direct presence in 13 countries in Latin America and more than 4,500 collaborators working under a sustainable model. Procaps develops, manufactures, and markets over-the-counter (“OTC”) pharmaceutical products and prescription pharmaceutical drugs (“Rx”), nutritional supplements and high-potency clinical solutions.