Health Sciences Group, the Los Angeles-based group which specialises in investing in companies involved in the health sector, has signed a letter of intent to acquire the assets and operations of Quality Botanical ingredients (QBI), a manufacturer of botanical products and nutritional ingredients.
Fred Tannous, CEO of Health Sciences, said that the aim was to finance and support the expansion of QBI, and that this should help sales grow by more than 25 per cent during the year. QBI's sales in 2001 were $12 million (€13.6m).
Health Sciences is looking to develop a range of proprietary pharmaceutical and nutraceutical products, and the acquisition of QBI will help it take a major step towards achieving this goal.
"QBI is expected to play a key role in the launch of our new and innovative product line in integrative medicine," said Bill Glaser, president of the company. The Cocare range will be available through alliances with major pharmaceutical companies, he said, and will target heart disease, colds and flu, arthritis, migraines, allergies and other conditions.
"With QBI as synergistic provider of the nutraceutical component of our products, we expect the vertical integration in the production process to translate into higher profit margins while maintaining competitive pricing," Glaser said.
Joseph Schortz, president and CEO of QBI, said he saw Health Sciences as a strategic partner which would help the company "bolster our market position by enhancing our product offerings and expanding the scope of our distribution channels".
Under the terms of the deal, QBI will become a subsidiary of Health Sciences.