Baxter finds a $4.3bn biopharma solution

Having announced the spinout of its renal care and acute therapies units in January, Baxter now plans to slim further with the sale of its biopharma solutions business to private equity for $4.3bn in cash. The buyers, Warburg Pincus and Advent International, will get a company specialising in sterile contract manufacturing and parenteral drug delivery systems that is expected to bring revenues of around $600m this year. This is down from the $644m the unit turned over last year – around 4% of Baxter’s total sales. Baxter will get $3.4bn in net proceeds, which ought to alleviate concerns over its ability to meet sizable near-term debt payments, Stifel analysts write. Overall, Baxter has outstanding debt of around $16bn. Following the three planned divestments Baxter’s revenues will shrink by around a third, with its largest remaining businesses being medication delivery, which largely deals with IV administration, and pharmaceuticals, which covers oncology drug platforms, inhaled anaesthesia and pharmacy compounding services. Beyond Baxter, divestments are also on the cards for five more healthcare groups, including Medtronic and Novartis. And Perkinelmer today relaunched itself under a new name – Revvity – having sold off its applied, food and enterprise services two months ago.