Nestle makes $1bn move in US pharma

 
City A.M. Reporter
NESTLE, the world’s biggest food group, has agreed to buy US gastrointestinal diagnostics firm Prometheus Laboratories for an estimated $1.1bn (£680.5m) as part of the Swiss group’s drive into health sciences.

Nestle said Prometheus, which is expected to have annual sales of around $250m in 2012, makes tests to help doctors diagnose conditions such as inflammatory bowel diseases, including Crohn’s disease and ulcerative colitis.

Nestle, maker of Nescafe coffee, KitKat chocolate bars and Maggi soup, hopes Prometheus’s sales force will push its hospital nutrition products like Peptamen and Novasource.

While Nestle declined to give financial details, analyst Jean-Philippe Bertschy at bank and asset manager Vontobel estimated Nestle might have paid more than 1bn Swiss francs ($1.1bn) for the company.

“The combined entity will be able to leverage the products and geographic presence in gastrointestinal diagnostics. We see that acquisition as a decisive step for Nestle,” he said.

Luis Cantarell, head of Nestle’s health science unit created at the beginning of the year, said the company hoped to develop personalised nutrition offerings with Prometheus’s diagnostics and expected the buy to accelerate its own research.

“We will incorporate the nutrition dimension through existing products and new products we are going to develop,” he said. “Significant innovations in the next 12 to 24 months will be added to the existing platform.”