Lannett Company announced it has completed the acquisition of Kremers Urban Pharmaceuticals (KU), the U.S. specialty generic pharmaceuticals subsidiary of global biopharmaceuticals company UCB S.A.

Lannett has acquired KU from UCB for total consideration of approximately $1.23 billion, subject to certain adjustments, including a customary working capital adjustment, a deduction of certain reimbursable amounts payable in connection with the financing of the transaction, and a reduction for any indebtedness and unpaid transaction expenses of KU existing at closing. In connection with the transaction, Lannett issued to UCB $200 million senior unsecured notes along with 2.5 million warrants, which may be net settled. UCB will also be eligible to receive contingent payments for Methylphenidate HCI ER when the product’s AB rating is restored.

In connection with the acquisition, Lannett said it has entered into a $1.035 billion secured credit facility and issued $250 million of senior unsecured notes (including those issued to UCB), the proceeds of which were used to fund the acquisition and related transaction costs. The secured credit facility comprises a $910 million term loan facility and a $125 million revolving credit facility, which will be available to Lannett for working capital and other general corporate purposes, such as future acquisitions.

According to a related 8-K filing, Lannett signed a commitment letter with Morgan Stanley Senior Funding and Royal Bank of Canada who will act as the joint lead arrangers and joint bookrunners for the credit facility.

Philadelphia, PA-based Lannett Company develops, manufactures, packages, markets and distributes generic pharmaceutical products for a wide range of medical indications.