Company active in pharmaceuticals

Issue:

The Company, active since 1990 in the development and registration of medicines, expanded its activities in 2019 by introducing Compounding and establishing a production and packaging facility. This expansion and rapid growth led to an increase in revenue from €13m in 2019 to €50m in 2022, with EBITDA rising from €6,6m to €25,1m. However, in 2023, revenue stagnated at €51m, while EBITDA declined to €20m due to delayed registrations, production issues, and rising operational costs. The Company aimed to continue its growth through professionalization, process optimization, and improvements in its delivery and registration processes, but it no longer met banking covenants and anticipated a liquidity shortfall. This created the need for validation of its future plans and financial projections.

Solution:

To address the issue, an external consultant validated the Company’s future plans and financial projections. This effort built upon a prior analysis by the advisory firm You Improve, which identified a significant improvement potential of €2,9m in EBITDA. The validation focused on creating realistic financial forecasts and providing insights into liquidity developments. Emphasis was placed on the professionalization of the organization, including the appointment of new management, optimization of internal processes, and improvement of delivery and registration processes. This approach helped the Company restore financial stability and establish a solid foundation for future growth.