Kelso takes big step towards building a ‘truly pan-European pharma business’

Kelso Pharma has completed its first international deal as it looks to build a major pan-European specialty drugs business out of Scotland.

The Edinburgh-headquartered company is headed by chief executive Tom Stratford, previously CEO of Kyowa Kirin International (KKI), the European and US business arm of Japan’s Kyowa Kirin, which purchased Borders-based ProStrakan Group in 2011. Kelso has now taken its first step in its European expansion strategy by agreeing to acquire Italian firm Velit Biopharma on undisclosed terms.

With some 100 partnership agreements in place with pharma companies in Europe, Asia and the Middle East, Velit has a portfolio of more than 50 pharma products and a strong pipeline of additional medicines in development. That includes a number of products available to be commercialised in the UK through Kelso’s existing infrastructure.

Stratford said: “Kelso Pharma is founded on our vision to bring innovative, value added, specialty medicines to healthcare markets across Europe and our acquisition of Velit is a perfect fit with this ambition. Not only does it have great people, but Velit brings with it a powerful portfolio alongside a rich pipeline of products which Kelso can bring through our existing platforms. We plan to build on the strong partnerships that Velit has already formed to create further international success as we build a truly pan-European specialty pharma business.”

The Kelso Pharma board members (left to right): Sam Gray, Apposite; Christian Schenk, Apposite, Tom Stratford, CEO; Gordon Cameron OBE, chairman; Allan Watson, CFO. Picture: Robert Perry

Sam Gray, managing partner at Kelso’s principal shareholder and backer, Apposite Capital, said: “This transaction represents an exciting opportunity for Kelso to build its business through the addition of this rapidly growing company. Velit’s products, existing and under development, will strengthen Kelso’s portfolio in its target markets while Kelso can provide additional support for Velit’s impressive list of partnerships.”

Velit’s therapeutic focus includes gastroenterology, dermatology and women’s health, all of which are complementary to Kelso’s existing portfolio of medicines. In addition, the Italian firm’s portfolio has products focusing on oncology and ophthalmology which will further extend the Scottish group’s in-house capabilities.

Velit’s founder and president, Nicola Travierso, is a well-known and respected figure in the international pharma community and will remain with the business and join Kelso’s executive management team. All other members of the Velit team will remain with the business. The deal is conditional on receiving Italian regulatory clearance.

Travierso said: “In Kelso we have found a true kindred spirit with whom we can take Velit to the next level alongside our valued partners. I look forward with enthusiasm and confidence to this next chapter in the Velit story in combination with Kelso Pharma.”

Since its inception in 2020, Kelso Pharma has taken a number of steps to grow the business in an “effective and sustainable manner”. The acquisition of Glasgow-based Stirling Anglian Pharmaceuticals (SAP) in January 2022 provided a UK platform and springboard for future sales growth for the business.

SAP’s brand portfolio already has four medicines in the UK healthcare market, including Acepiro (Acetylcysteine) which was launched earlier this year and is used to loosen mucus and to ease coughing up in cases of respiratory diseases with viscous mucus.