Within 2 weeks of the purchase of CLIA laboratory,
OPKO Health, Inc.
) has come up with yet another acquisition deal. This time, the
Miami based biopharmaceutical and Diagnostics company is planning
to expand in Brazil, the largest growth market of Latin America.
OPKO stated that it has entered into a definitive agreement to
acquire Sao Paulo based Silcon Comércio, Importacao E Exportacao
de Produtos Farmaceuticos e Cosmeticos Ltda. The financial terms
of this deal were not disclosed.
Although the enrollment of a new business in a new region is
complex and time consuming, many companies adopt this short-cut
method of acquisition. This immediately allows the company to
market its product through the acquired company directly from day
one. Apart from providing these cross-marketing opportunities for
OPKO's products, the acquisition of Silcon will strengthen OPKO's
diagnostic business as this will enable the company get the
permits to commercialize its latest prostate cancer test 4KScore
in Brazil as a reference laboratory test. OPKO believes that the
successful completion of this deal will help the company expand
faster in the growing Latin American market and will also
complement the business activities of the units in Chile and
Over the past few quarters, OPKO has been focusing on
exploring opportunities to acquire complementary pharmaceuticals,
compounds, technologies, and businesses. On December 18, 2012,
OPKO acquired Prost-Data, Inc., which is doing business as
OURLab, a Nashville-based CLIA (
Clinical Laboratory Improvement Amendments)
laboratory with 18 phlebotomy sites throughout the U.S. and an
experienced national sales force calling primarily on urologists.
OPKO expects OURLab to provide the company with a commercial
platform to support the U.S. commercial launch of its panel of
kallikrein biomarkers and 4Kscore.
Earlier in August 2012, the company acquired Farmadiet, a
Spanish company engaged in the development, manufacture,
marketing, and sale of pharmaceutical, nutraceutical, and
veterinary products in Europe. OPKO, with this acquisition,
entered in the European Union. The acquisition of the Chilean
pharmaceutical company ALS in April was another important
We believe that OPKO's acquisition and expansion strategy
bodes well with the company's strong cash profile ($23.4 million
of cash and cash equivalents at the end of September 2012).
However, the company performs in a fiercely competitive platform
with players like
Merck & Co. Inc.
).The stock retains a Zacks #4 Rank (Sell in the short term).
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