Aceto unit to make generic antifungal drug

The Port Washington-based specialty chemical company Aceto Corp. said Monday a major subsidiary will make the first generic version of the antifungal drug Ancobon.

Aceto, traditionally a supplier of bulk chemicals, is redefining itself as a maker of finished pharmaceutical products through the subsidiary, Rising Pharmaceuticals Inc.

The December 2010 purchase of Rising, of Allendale, N.J., has given Aceto the opportunity for "a strong pipeline of new products that would drive sales and expand margins," said Daniel Rizzo, an analyst with Sidoti & Co. Llc of Manhattan. The purchase and the new generic drug products are part of Aceto's long-term strategy, Rizzo said.

Rising will make and sell flucytosine, the generic version of Ancobon, in 250 mg and 500 mg capsules. The drug is used to treat serious infections caused by candida and cryptococcus fungi.

Aceto also said Monday Rising will make and market a version of the malaria medication Aralen (chloroquine phosphate) in 500 mg tablets.

Aceto shares fell 3.50 percent to $6.07 Monday and are down more than 31 percent for the year to date. With 238 employees, Aceto has a stock market capitalization of more than $160 million. It generated a $9.2-million profit on $426 million in revenue during the 12 months through September.

Aceto said market research showed the two drugs generated $20 million in U.S. sales for the 12-month period ended in June.

In the company's quarterly report issued Nov. 3 chief executive Albert Eilender said Aceto's sales in its health sciences segment -- which got a boost from the acquisition of Rising -- increased 46.9 percent for the quarter ended Sept. 30, compared to the prior-year quarter.

Meanwhile its sales declined 8.3 percent in its specialty chemicals division, including aroma products and surface coatings for housing and vehicles. In its agricultural protection products segment, revenue fell 62.2 percent, due in part to decreased sales of the herbicide glyphosate.

Eilender said the launch of the malaria remedy "marks the first leveraging of a product by Rising that was brought to them directly as a result of Aceto's worldwide sourcing capabilities."