Blood, It Does a Body Good! Spain's Grifols $3.4 Billion Talecris Investment to Create Global Plasma Giant

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Reported by Annette Kreuger, Industrial Info Resources (Sugar Land, Texas)--The $3.4 billion offer by Grifols (Barcelona, Spain) to buy Talecris Biotherapeutics (NASDAQ:TLCR) (Research Triangle Park, North Carolina) is the latest entry in the ongoing merger-and-acquisition growth method in the Pharmaceutical-Biotech Industry. Expected to close later this year, the plasma protein companies are expected to generate combined annual revenue of about $2.8 billion.

Grifols has facility centers in more than 90 countries, where it performs research, development, and production of plasma derivatives, IV therapy, enteral nutrition, diagnostic systems and medical materials. The company has a manufacturing plant in Los Angeles, California, which is in the midst of a $135 million expansion to increase production of Flebogamma IV. Produced from healthy human blood, the medication is used to strengthen the body's immune system, as well as to increase blood counts in those suffering from particular blood disorders.

The purchase will give Grifols the Talecris critical care treatments for a variety of life-threatening disorders, including hemophilia and immune deficiencies. The company, formed in 2005 following the purchase of Bayer Biological Products' plasma-based business, has two manufacturing plants in the United States. The Talecris Research Triangle Park, North Carolina, location is currently in advanced planning for a $270 million expansion, which is expected to move forward. In the short term, the pending deal will allow Talecris to expand production by utilizing existing Grifols capacity until the expansion is complete.

The union between the two companies will result in a truly global plasma protein therapies operation. Talecris offers its strength in North America to enhance Grifols international presence. The Talecris deal is not the first indication of Grifols' desire to expand its presence in the U.S. In addition to the expansion at its Los Angeles plant, the company is in the midst of building a $15 million plasma testing facility in San Marcos, Texas. Plans for the addition of a $61 million fractionation plant at the site are under consideration.

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