Pharmaceutical company Paladin Labs Inc. has acquired the Canadian rights to the Tempra children's pain relief products from Bristol Myers Squibb.
The popular pain relief syrup and drops have been available since 1957. Sales last year were about $3-million, representing about 19 per cent of Canadian sales of pediatric acetaminophen products.
Tempra will be added to Paladin's existing portfolio of pediatric over-the-counter and prescription products such as Zincofax for diaper rash, Anbesol for teething, Cerumol for ear wax removal, Twinject for anaphylaxis and Kaeopectate for diarrhea.
"Pediatrics is an area of focus for Paladin and we intend to remain vigilant in expanding our presence in this area," said CEO Jonathan Ross Goodman.
The product will continue to be made by a third-party manufacturer in the Montreal area and the acquisition won't have any impact on employment, said chief financial officer Samira Sakhia.
She said consumers won't notice any difference, although the packaging could eventually change once a marketing plan is developed over the next year.
"It has languished at Bristol Myers Squibb just being very small in a very big organization," she said in an interview. "But we have a growing over-the-counter division...and this will be one of the feature products that we'll be carrying."
Bristol Myers Squibb inherited Tempra during a past acquisition but is selling the global rights as it transitions from a traditional drug maker to a biotechnology company.
In 2009, it sold most of its Asia-Pacific over-the-counter drug business outside Japan and China to Taisho Pharmaceutical Co. for $310-million (U.S.).
Pooya Hemami of Desjardins Securities said the transaction was positive for Paladin and should add about 2 per cent to its total revenue.
Financial terms of the agreement were not disclosed. But Hemami said such transactions are often completed for two to 2.5 times sales, suggesting a purchase price of $6-million to $7.5-million.
"Given the long-standing and widespread use of acetaminophen products in the Canadian marketplace, we estimate that sales trends for the Tempra line should not fluctuate materially from current levels," the analyst wrote in a report.
"We view incremental product acquisitions that add stable recurring revenues, such as the Tempra transaction, as an attractive deployment of capital."
In a separate announcement, Paladin out-licensed certain voclosporin rights to original holder Isotechnika for $1-million while retaining the rights to Canada, South Africa and Israel.
It also received $3.25-million from the sale of 12.5 million Isotechnika shares to ILJIN Life Science Co.