Strides Pharma Science Ltd, based in Bengaluru, announced on Monday that it will spin off its contract development and manufacturing organization (CDMO) and soft gelatin business into a new entity that would go public in the following 12-16 months.
The new company, dubbed “OneSource,” will employ over 1,200 people and generate revenue of $180 million to $200 million in fiscal 2025. Strides Pharma stockholders will get one share of ‘OneSource’ for every two Strides shares, at a swap ratio of 1:2. For Strides shareholders, the implied value of OneSource is Rs 364 per share. Strides’ shareholders will control 44% of OneSource’s economics.
OneSource is formed by combining Strides’ soft-gel and SteriScience’s CDMO injectables businesses with current Stelis. Strides Pharma shares rose 7.42 percent in response to the news, reaching a 52-week high of Rs 549 before ending at Rs 535.65 on the BSE.
It also aims for an earnings before interest, taxes, depreciation, and amortization (EBITDA) margin of about 30%, which is forecast to rise to more than 35% by FY26.
“The new platform will be able to offer development and manufacturing services covering platform technologies, specialty injectables, complex generics, biosimilars and biologics,” it stated. Strides stated in an investor presentation that they expect the OneSource company to reach sales between $180 million and $200 million in FY25, with an Ebitda margin of around 30% based on a solid order book. OneSource has the potential to quadruple its scale in 3-4 years, owing mostly to the momentum generated by biologics and high-end drug-device combinations in GLP-1 products, according to the company.