Fresenius Medical Care, the world’s largest provider of dialysis products and services, today announced the divestment of the business of Shiel Medical Laboratory, Inc. to Quest Diagnostics, Inc. Shiel provides comprehensive non-dialysis laboratory services in the New York-New Jersey metropolitan area.

The decision to divest Shiel is aligned with Fresenius Medical Care’s goal to further optimize the Company’s Care Coordination portfolio. Fresenius Medical Care’s dialysis-related laboratory services business, Spectra Labs, is not affected by the divestiture.

The divestment is expected to generate a modest book gain for Fresenius Medical Care. Closing of the transaction is subject to regulatory approvals and anticipated in the fourth quarter of 2017.

“The sale of Shiel Medical Laboratory will optimize the growth profile of our portfolio of Care Coordination activities in the U.S.,” said Rice Powell, Chief Executive Officer of Fresenius Medical Care. “Based on the business’ development relative to our original expectations we’re keen to focus on areas offering superior growth and benefits for our core activities. With this transaction, Shiel’s customers will have access to even more diagnostic expertise. Ensuring a smooth transition will be a priority.”

“By joining forces with Shiel, physicians and patients in the New York-New Jersey region will have broader access to Quest’s diagnostic insights and innovations,” said Steve Rusckowski, Quest Diagnostics Chairman, President and CEO. “The acquisition will also deliver on Quest's strategy to accelerate growth and drive operational excellence through strategically aligned, accretive acquisitions."

Fresenius Medical Care and Quest will also collaborate on identifying patients with early-stage chronic kidney disease, based on Quest’s laboratory data analytics, who may benefit from treatment to slow progression to end-stage renal disease (ESRD).

The price increase for hospital services in Germany has been set at 2.97% for 2018. This is in line with the level of past years.

The price increase for hospital services in Germany has been set at 2.97% for 2018. This is in line with the level of past years. 

Fresenius Medical Care has expanded its regional manufacturing plant in Bandar Enstek, Malaysia. Dato' Seri Dr. Chen Chaw Min, Secretary General of the Malaysian Ministry of Health graced the opening ceremony. The plant is a state-of-the-art facility and will be Fresenius Medical Care's regional manufacturing hub for Southeast Asia. In addition to supplying high-quality hemodialysis concentrates and disinfectants, the plant produces peritoneal dialysis (PD) products necessary for advanced continuous ambulatory PD treatment.

Caspofungin, an antifungal medicine, expands the company's sterile injectable anti-infective portfolio.

Fresenius Kabi celebrated the 20-year anniversary of its Friedberg plant in the state of Hesse today. Since production began in 1997, the Fresenius Kabi site has produced more than two billion bottles and bags with infusion solutions, blood volume substitution agents and liquid drugs. These products are used in the therapy and treatment of critically and chronically ill patients.

The adjoining logistics center is the international hub for the company’s entire product line. Each day employees here fill roughly 2,000 orders. The logistics depot is equipped with a fully automated high-rack warehouse with space for 75,000 pallets. Shipments are assembled and packed in the semi-automated pick-and-drop area. From there they are shipped to wholesalers, pharmacies and hospitals in Germany, and worldwide to national subsidiaries of Fresenius Kabi.

Fresenius Kabi has invested about €150 million in the site – and continues to invest. The next step is expansion of the logistics center in response to increasing volume. The building will be expanded by 4,500 square meters (about 50.000 square feet) at a cost of six million euros. The expansion should be completed by early 2019.

Joachim Arnold, County Commissioner of the Wetterau region, acknowledged the importance of the plant for the region: “Fresenius Kabi has for many years been an important company and major employer. The ongoing investment represents job security and is also a tribute to the quality of this site.”

“We will continue the success story of Fresenius Kabi in Friedberg. The new investment expands the capacity of the logistics center to ship our products throughout the world. This means we can help more patients”, said Dr. Michael Schönhofen, member of the Fresenius Kabi Management Board and President of the Pharmaceuticals Division.

Fresenius Kabi currently employs about 750 people at the production site and logistics center in Friedberg, making it one of the largest employers in the Wetterau region. There are also roughly 40 trainees engaged as, for example, chemistry lab assistants, freight forwarders, logistics service providers and mechatronics technicians.

 

Fresenius Kabi has successfully closed the acquisition of Merck KGaA’s biosimilars business. The transaction comprises the entire development pipeline of Merck’s biosimilars and an experienced team of employees located in Aubonne and Vevey, Switzerland. The product pipeline has a focus on oncology and autoimmune diseases, and addresses a market with current annual branded sales of around US$30bn. The biosimilars business will be consolidated as of September 1, 2017.

The purchase price of €656 million will be mainly cash flow financed. Thereof, €156 million have been paid upon closing. Up to €500 million are milestone payments strictly tied to achievements of development targets in the coming years. The slight reduction in purchase price is related to phasing of R&D expenditures between signing and closing of the acquisition. These are now expected to amount to around €60 million from closing until year-end 2017. All clinical studies for the product pipeline are on track.

The transaction is estimated to be EBITDA break-even in 2022. From 2023 onwards, the acquisition is expected to be significantly accretive to Group net income¹ and Group EPS¹.

The relevant antitrust authorities have approved the transaction without imposing conditions.

 

¹ Net income attributable to shareholders of Fresenius SE & Co. KGaA