King Pharmaceuticals

King Pharmaceuticals, Inc. was an American pharmaceutical company headquartered in Bristol, Tennessee. Incorporated in Tennessee in 1993, it built its business through a combination of contract manufacturing, acquisitions of established prescription brands, specialty pharmaceutical development, and medical-device manufacturing. The company became known for purchasing underpromoted or non-core branded medicines and investing in their sales, marketing, manufacturing, and distribution rather than relying primarily on internally discovered products. King's early operations centered on manufacturing medicines for other pharmaceutical companies. In January 1994, it purchased a former King College campus manufacturing site in Bristol from RSR Pharmaceutical for approximately $1.18 million. The facility gave the young company a substantial production base. King subsequently shifted toward acquiring branded prescription products, which generally offered higher margins and stronger commercial control than contract production alone. In 1998, it acquired a portfolio of branded medicines, a sterile-products facility in Rochester, Michigan, and related contract manufacturing arrangements. The sterile-products operation was later placed in the Parkedale Pharmaceuticals subsidiary. The company's most important commercial turning point came in December 1998, when its Monarch Pharmaceuticals subsidiary obtained United States marketing and distribution rights for Altace, a ramipril-based cardiovascular medicine, from Hoechst Marion Roussel. Altace had not been heavily promoted in the United States by its previous owner. King expanded the sales effort, and the drug benefited from attention generated by the HOPE cardiovascular-outcomes study. Altace became a major source of revenue and helped finance further acquisitions. In 2000, King added products including Levoxyl, Thrombin, and Cytomel, and it also acquired a North Carolina research-and-development company as opportunities for straightforward brand purchases became less abundant. King broadened its capabilities in 2002 and 2003 through the acquisition of Meridian Medical Technologies. Meridian manufactured drug-delivery devices, including the EpiPen epinephrine auto-injector. This transaction gave King a larger presence in emergency medication delivery and medical devices in addition to conventional prescription drugs. The company later expanded into pain treatment through its 2008 acquisition of Alpharma Pharmaceuticals. That deal added products and intellectual-property assets associated with Flector and Embeda, as well as Alpharma's animal-health business serving livestock and agricultural markets. Leadership changes and regulatory scrutiny complicated King's later history. Founder John Gregory left the chief executive position in 2002, with Jefferson Gregory succeeding him. Jefferson Gregory stepped down in 2004 after the Securities and Exchange Commission began investigating the company's Medicaid billing practices. Brian Markison then became chief executive. A proposed $4 billion acquisition by Mylan Laboratories announced in 2004 was opposed by some investors, including Carl Icahn, who argued that Mylan was paying too much. The transaction was abandoned in 2005. By the late 2000s, King operated several manufacturing facilities, including sites in Bristol, Rochester, St. Louis, St. Petersburg, and Middleton, and employed approximately 2,700 people, including a sales organization of more than 1,000 representatives. Its portfolio included cardiovascular, endocrine, sleep, musculoskeletal, pain, emergency-care, and animal-health products. Pfizer announced an agreement to acquire King on October 12, 2010, for $14.25 per share in cash, representing a total transaction value of approximately $3.6 billion. The deal was completed later that year, and King became a wholly owned Pfizer subsidiary rather than continuing as an independent publicly traded pharmaceutical company.

King Pharmaceuticals was incorporated in Tennessee in 1993 by John M. Gregory, Randal J. Kirk, Joseph R. Gregory, Jefferson J. Gregory, and James E. Gregory. Its first major operating asset was a former King College campus manufacturing facility in Bristol, Tennessee, purchased in January 1994. King initially manufactured products for other pharmaceutical businesses, but management soon adopted an acquisition-led strategy focused on established branded prescription medicines. The company expanded rapidly before and after its public offering in June 1998. In February 1998, it acquired a group of branded products, a sterile-products plant in Rochester, Michigan, and related contract manufacturing contracts. King organized this sterile-products activity under Parkedale Pharmaceuticals. Later in 1998, Monarch Pharmaceuticals, a King subsidiary, purchased U.S. marketing and distribution rights for Altace and additional Hoechst products. Altace was especially important because its prior owner had reduced U.S. promotional activity. King increased sales coverage and benefited from clinical evidence associated with the HOPE study, turning Altace into a major commercial asset. Using revenue from Altace and other acquired products, King added Levoxyl, Thrombin, Cytomel, and other brands in 2000. It also purchased a North Carolina research-and-development company. In 2002, King agreed to purchase Meridian Medical Technologies for $247.8 million in cash; the transaction closed in January 2003. Meridian manufactured autoinjectors, including EpiPen, and the deal broadened King's business beyond oral and conventional prescription medicines. Governance became more unsettled in the early 2000s. John Gregory left the chief executive role in 2002, and Jefferson Gregory succeeded him. Jefferson Gregory later stepped down in 2004 amid an SEC investigation into King's Medicaid billing practices. The board appointed Brian Markison as his replacement. In the same period, Mylan Laboratories proposed acquiring King for about $4 billion. Investors, including Carl Icahn, criticized the valuation, and the deal was ultimately called off in 2005. King continued to pursue portfolio expansion. Its 2008 acquisition of Alpharma Pharmaceuticals added pain-management products, including Flector and Embeda, and brought an animal-health operation serving livestock and agricultural customers. The company operated manufacturing sites in Bristol, Rochester, St. Louis, St. Petersburg, and Middleton. At its later independent peak, it employed approximately 2,700 people and maintained a sales force of more than 1,000. Pfizer announced the purchase of King Pharmaceuticals on October 12, 2010. Pfizer offered $14.25 in cash for each King share, for an aggregate transaction value of approximately $3.6 billion. The acquisition gave Pfizer additional pain products, EpiPen-related capabilities, and Alpharma's animal-health business. Following completion of the transaction, King ceased to operate as an independent publicly listed pharmaceutical company and became a wholly owned Pfizer subsidiary.

• 2010

  Pfizer acquisition announced

  [1]King Pharmaceuticalsen.wikipedia.org

  Pfizer announced an agreement to acquire King for $14.25 per share in cash.

• 2008

  Alpharma acquired

  [1]King Pharmaceuticalsen.wikipedia.org

  King acquired Alpharma Pharmaceuticals, expanding into pain management and animal health.

• 2003

  Meridian acquisition completed

  [1]King Pharmaceuticalsen.wikipedia.org

  King completed its acquisition of Meridian Medical Technologies, adding autoinjector and emergency medication-delivery capabilities.

• 2000

  Portfolio and research expansion

  [1]King Pharmaceuticalsen.wikipedia.org

  King acquired products including Levoxyl, Thrombin, and Cytomel and added a North Carolina research-and-development company.

• 1998

  Sterile-products and branded-product expansion

  [1]King Pharmaceuticalsen.wikipedia.org

  King acquired branded medicines, a Rochester sterile-products facility, and related contract manufacturing business, later organizing the operation under Parkedale Pharmaceuticals.

• 1998

  Altace rights acquired

  [1]King Pharmaceuticalsen.wikipedia.org

  Monarch Pharmaceuticals acquired U.S. marketing and distribution rights for Altace and other Hoechst products.

• 1998

  King becomes publicly traded

  [1]King Pharmaceuticalsen.wikipedia.org

  King Pharmaceuticals completed its public offering in June.

• 1994

  Bristol manufacturing facility acquired

  [1]King Pharmaceuticalsen.wikipedia.org

  King purchased a former King College campus plant in Bristol, Tennessee, establishing an important manufacturing base.

• 1993

  King Pharmaceuticals is incorporated

  [1]King Pharmaceuticalsen.wikipedia.org

  King Pharmaceuticals, Inc. was incorporated in Tennessee by a group including John M. Gregory, Randal J. Kirk, Joseph R. Gregory, Jefferson J. Gregory, and James E. Gregory.

A branded-prescription pharmaceutical company that combined acquired product rights, commercial relaunches, specialty medicines, contract and sterile manufacturing, and drug-delivery devices. King differentiated itself by finding established medicines with underdeveloped commercial potential and investing in sales, promotion, and distribution.

• Cardiovascular medicine

  Altace

  Altace was King's most commercially important branded medicine. King obtained U.S. marketing and distribution rights from Hoechst Marion Roussel in 1998 and invested in expanded promotion. The product was used in cardiovascular care, and its commercial performance improved after increased sales activity and attention associated with the HOPE outcomes study.

• Thyroid medicine

  Levoxyl

  Levoxyl was one of the established prescription brands added to King's portfolio in 2000. It served the thyroid-treatment segment and illustrated King's strategy of building scale by acquiring marketed medicines rather than relying exclusively on internally discovered products.

• Emergency drug-delivery device

  EpiPen

  EpiPen was an epinephrine autoinjector associated with Meridian Medical Technologies, acquired by King in a transaction completed in 2003. The product gave King a significant position in emergency medication delivery and added device manufacturing to its pharmaceutical portfolio.

• Pain-management medicine

  Flector Patch

  Flector was a topical pain-treatment product obtained through King's acquisition of Alpharma in 2008. It helped move King further into pain management and was among the assets that made the company attractive to Pfizer.

• Pain-management medicine

  Embeda

  Embeda was a pain-management product obtained from Alpharma. Along with Avinza and Flector, it formed part of the pain portfolio that Pfizer identified as a strategic benefit of acquiring King.

• Pain-management medicine

  Avinza

  Avinza was a pain-treatment brand included among King's products cited in connection with Pfizer's acquisition. It represented King's later emphasis on pain relief and management.

• Sleep aid

  Sonata

  Sonata was a prescription sleep aid within King's broad branded-pharmaceutical portfolio. It illustrated the company's presence in central-nervous-system and sleep-related treatments alongside its cardiovascular, endocrine, musculoskeletal, and pain products.

• Muscle relaxant

  Skelaxin

  Skelaxin was a prescription muscle relaxant marketed by King. It represented the company's musculoskeletal and pain-related product activities before the business was acquired by Pfizer.

• Thyroid medicine · 2000

  Cytomel

  Cytomel was among the branded medicines King acquired in 2000 as it used revenue from Altace to broaden its endocrine and prescription-drug portfolio.

• Hemostatic pharmaceutical · 2000

  Thrombin

  Thrombin was one of the products added to King's portfolio in 2000. Its inclusion reflected the company's strategy of acquiring established medicines across several therapeutic areas.

• 2004

  SEC investigation into Medicaid billing practices

  The Securities and Exchange Commission investigated King's Medicaid billing practices. The scrutiny coincided with Jefferson Gregory's departure as chief executive and the appointment of Brian Markison.

  Source

Read more

• 1999Altace U.S. commercial relaunch

  United States

  After acquiring U.S. marketing and distribution rights for Altace, King increased the sales effort and promoted the cardiovascular brand more extensively than its previous owner had done.

  Outcome. Altace sales grew and became a major source of funding for King's subsequent acquisitions.

  Source

• 2010

  Pfizer acquisitionM&A

  Background

  Pfizer sought to expand its pain-management portfolio and add King's emergency drug-delivery and animal-health assets.

  Action taken

  Pfizer agreed to acquire King for $14.25 per share in cash, with an aggregate transaction value of approximately $3.6 billion.

  Aftermath

  King became a wholly owned Pfizer subsidiary and ceased to operate as an independent public pharmaceutical company.

  Acquisition consideration. $14.25 per share; approximately $3.6 billion total transaction value (Announced October 12, 2010; completed in 2010)

  Source

• 2008

  Acquisition of Alpharma PharmaceuticalsM&A

  Background

  King wanted to increase its presence in pain treatment and add complementary healthcare businesses.

  Action taken

  King acquired Alpharma Pharmaceuticals.

  Aftermath

  The transaction added Flector, Embeda, Avinza-related pain assets, and an animal-health division.

  Source

• 2004

  Proposed sale to MylanM&A

  Background

  Mylan proposed acquiring King as King faced leadership changes and regulatory scrutiny.

  Action taken

  The companies announced a proposed $4 billion transaction.

  Aftermath

  Investors, including Carl Icahn, criticized the valuation, and the transaction was abandoned in 2005.

  Proposed acquisition value. $4 billion (2004 proposal; terminated in 2005)

  • Carl Icahn — The investor criticized the transaction on the grounds that Mylan was overpaying for King.

  Source

• 2002

  Agreement to acquire Meridian Medical TechnologiesM&A

  Background

  King sought to expand beyond conventional pharmaceutical products into drug-delivery systems.

  Action taken

  King agreed to purchase Meridian for $247.8 million in cash; the transaction was completed in January 2003.

  Aftermath

  King gained autoinjector manufacturing capabilities and the EpiPen business.

  Purchase price. $247.8 million transaction value (2002 agreement; completed January 2003)

  Source

• 1998

  Shift toward acquired branded medicinesStrategy

  Background

  King began as a contract manufacturer but identified higher-margin opportunities in marketed prescription brands.

  Action taken

  The company acquired branded products and rights, then invested in sales, marketing, and distribution.

  Aftermath

  The strategy established the foundation for the Altace business and King's later portfolio expansion.

  Source

1. 1King Pharmaceuticalsen.wikipedia.org