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R.P. Scherer to Gain New Drug-Delivery Business With Acquisition of International Processing Corporation

BASKING RIDGE, N.J., Dec. 5 /PRNewswire/ -- R.P. Scherer Corporation, a subsidiary of Cardinal Health, Inc. (NYSE: CAH) and a leading developer and manufacturer of drug-delivery technologies, announced today it has agreed to acquire International Processing Corporation (IPC) of Winchester, Kentucky, in a cash transaction valued at approximately $40 million. No other financial terms were disclosed. The acquisition is expected to close within 60 days, subject to regulatory clearances and other customary conditions. Under the agreement, R.P. Scherer will acquire IPC's contract development and manufacturing business, which uses advanced controlled-release drug delivery manufacturing technology to produce prescription and over-the-counter medicines for pharmaceutical companies. The company's 100,000 square-foot manufacturing center in Winchester employs more than 200 people and is approved for the production of pharmaceutical products by the U.S. Food and Drug Administration and other domestic and international regulatory agencies. IPC specializes in producing solid-dose formulations using advanced manufacturing technologies that enable the company to develop and produce medicines that release drug compounds into the bloodstream over specific periods of time. The technology involves applying specialized coatings to granular particles of drug compounds, which are then formed into oral tablets and capsules by IPC or its customers. IPC's techniques also can be used to "taste-mask" oral drugs, making them more palatable and therefore improving patient compliance in taking medications as prescribed. The technology can be applied to many different classes of drugs to alter and improve their therapeutic benefits. Medicines incorporating IPC's drug- delivery methods often provide performance advantages versus competing products. "There is a tremendous amount of development work going on across the pharmaceutical industry in the area of new controlled-release medicines," said George L. Fotiades, president and chief operating officer of Cardinal Health's pharmaceutical technologies and services businesses. "This fully commercialized technology, while new to R.P. Scherer, is already playing an important role in improving the effectiveness and extending the commercial lives of drugs. We are very pleased to have reached this agreement with IPC and we look forward to bringing their best-in-class capabilities to our pharmaceutical company partners. This transaction gives Cardinal Health another important solution for our customers and is very complementary to our global marketing strategy." The purchase of IPC broadens Cardinal Health's integrated service offering for pharmaceutical and biotechnology companies. Cardinal Health can help its clients formulate, develop, produce, package, launch, distribute and market products. Its contract manufacturing offering includes R.P. Scherer for softgels, fast-dissolving tablets and topical formulations, and Automatic Liquid Packaging for sterile fluids, ointments and a variety of other dosage forms. "With Cardinal Health, IPC will be able to grow more quickly, will have greater access to capital for investment and by partnering with other Cardinal Health companies, will be able to bring more comprehensive, integrated solutions to pharmaceutical and biotechnology firms," said Ken Olsen, chief executive officer of IPC. "We have broad experience in manufacturing, process development and analyzing solid-dosage formulations, capabilities that are increasingly being sought after and outsourced by drug companies around the world." R.P. Scherer's proprietary technologies -- including soft gelatin capsules, Zydis(R), and topical Microsponge(R) and Polytrap(R) microparticles deliver a variety of benefits, including improving a drug's solubility, stability, efficacy and patient compliance, as well as reducing side effects. Scherer's softgel technology is used in products such as Abbott Laboratories' Norvir(R) and Kaletra(TM) protease inhibitors and Whitehall Robins' Advil(R) Liqui-Gels(TM). Zydis(R) tablets dissolve almost instantly on the tongue without the need for water and are used in versions of several important drugs, including Schering-Plough's Claritin(R) and Eli Lilly's Zyprexa(R). Formulations using the Microsponge(R) technology are included in more than 100 commercialized products, including Ortho Dermatological's Retin-A(R) Micro(TM). R.P. Scherer has operations worldwide, employing more than 3,600 people at 15 manufacturing centers in 10 countries serving health care on five continents. Cardinal Health, Inc. ( http://www.cardinal.com ) is a leading provider of products and services supporting the health-care industry. Cardinal Health companies develop, manufacture, package and market products for patient care; develop drug-delivery technologies; distribute pharmaceuticals, medical- surgical and laboratory supplies; and offer consulting and other services that improve quality and efficiency in health care. The company employs more than 40,000 people on five continents and produces annual revenues approaching $30 billion. Except for historical information, all other information in this news release consists of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected, anticipated or implied. The most significant of these uncertainties are described in Cardinal Health's Form 10-K, Form 8-K and Form 10-Q reports and exhibits to those reports, and include (but are not limited to) the costs and difficulties related to the integration of acquired businesses, the loss of one or more key customer or supplier relationships, changes in the distribution outsourcing pattern for health-care products and/or services, and the costs and other effects of governmental regulation and legal and administrative proceedings. Cardinal Health undertakes no obligation to update or revise any forward-looking statements. SOURCE Cardinal Health, Inc.