3M to divest drug delivery business in $650m deal

3M has decided to sell off most of its drug-delivery business to focus more resources on its core healthcare business.

The company formed its drug-delivery business in 2000 out of its larger pharmaceutical division in recognition of its significant potential for growth as an individual business. Today, the business that is being divested has annual global sales of roughly $380 million.

An affiliate of Altaris Capital Partners has agreed to pay 3M about $650 million and a 17% non-controlling interest in the new company that will be formed with the acquired drug-delivery assets.

“The drug delivery business is a leading provider of transdermal and inhalation delivery technologies,” said Michael Roman, chairman and CEO at 3M. “This transaction will allow us to focus more resources on our core health care business as well as retain a share in the value of the drug delivery business as it grows over the coming years.”

The deal is expected to close in the first half of 2020, and approximately 900 3M employees will join the new company after the sale.

Divestment of the drug delivery business follows 3M’s acquisition of wound care solutions provider Acelity and its subsidiaries for around $6.7bn in October 2019.

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