Since going public five years ago, Recipharm, Sweden’s iconic indigenous contract development and manufacturing organization (CDMO), has seen its sales skyrocket by over 30 percent annually. Much of this growth has been driven by an acquisition streak with the company plucking up overseas production assets such as former Roche and Sanofi facilities in Spain and the UK as well as plants across India.
Our clients want us to be successful, as this means that we are here for the long-term, ensuring continuity to their supply. Therefore, going public did not only help us when it came to financing but also in a commercial sense
Thomas Eldered, Recipharm
“The IPO was essentially a means to secure additional funding to speed up our international expansion and finance rapid inorganic growth,” recalls CEO Thomas Eldered. Regarding the move to India, he says that the company’s presence there “has become quite a differentiating factor from the competition, and we have been able to harness that footprint to bolster our development capabilities, which has a lot of potential in India.”
Going public has not only fuelled expansion, but has also set Recipharm apart from the competition. “When we went public, we had doubts about how our clients would react when our financial performance was made available, but it turned out that customers actually appreciated the transparency that comes with Recipharm being a public company, while many of our competitors are privately-held. Our clients want us to be successful, as this means that we are here for the long-term, ensuring continuity to their supply. Therefore, going public did not only help us when it came to financing but also in a commercial sense,” he rejoices. Going forward, Recipharm will continue looking for potential targets to acquire, while also remaining focused on its organic growth.
None of this has made the company tone down its manufacturing presence in its home market, however. “We continue to maintain a strong industrial footprint in Sweden, with no fewer than five manufacturing sites in Stockholm, Höganäs, Karlskoga, Strängnäs and Uppsala respectively,” notes Eldered. Moreover, the group is committed to contributing to the growth of the Swedish healthcare and life sciences ecosystem by collaborating with, and investing in, smaller local companies. “We are pleased to work with many companies from Sweden, also helping them when it comes to pharmaceutical development. A large share of our development business is based on partnering with Swedish companies, which proves that we have a great relationship with the Swedish environment,” he emphasizes.
While conscious of the need to always scale the value chain when operating production facilities in mature, developed ecosystems like Sweden, Recipharm is for the moment continuing to eschew any move into biologics. “We have decided to stay away from manufacturing biological compounds for now, remaining focused on the fill and finish part, which is our core bread and butter business… Most of our products are for injections and this market is still registering decent growth, and anyhow we’re still talking about a highly specialized activity to make these compounds so it makes sense to persevere with this niche.”
Read the full interview with Recipharm’s Thomas Eldered here