Schering AG $180 mil. Medrad acquisition will provide combo contrast media/syringe offerings.

SCHERING AG $180 MIL. MEDRAD BUY WILL PROVIDE COMBO CONTRAST MEDIA/SYRINGE product offerings, Medrad noted Aug. 23 in announcing the acquisition. Schering's position in the worldwide contrast media market "will be further strengthened by packaging [its] contrast media with Medrad's disposable syringes to create a simpler, more efficient administration system for customers," Medrad said.

Medrad and Schering have no product overlap, with the primary area of synergy being Schering's contrast agents. Schering diagnostic imaging agents accounted for approximately 36%, or $1 bil. of total 1994 Schering sales of $2.9 bil. The remainder of Schering sales consist of non-device/diagnostics businesses in fertility control and hormone therapy products, therapeutics and dermatology products.

About four-fifths of the diagnostic sales were X-ray contrast media imaging agents such as Iopamiron, Omnipaque, Ultravist and Isovist. About one-fifth of sales were from Magnevist MRI contrast media. Products in the pipeline include Levovist ultrasound contrast medium intended for imaging of the left ventricle, Echovist ultrasound contrast medium for gynecological indications, Gd-EOB-DTPA and Magnetites MRI contrast media for early diagnosis of liver tumors and Cavisomes ultrasound contrast medium for early diagnosis of liver tumors.

Medrad products include: the Mark V Plus angiography contrast agent injection system and accompanying syringes; the EnVision CT computed tomography injection system and syringes, introduced worldwide in July; and the Front Load CT injection system and Quick-Fit syringes. The firm also markets magnetic resonance imaging coils on an "original equipment manufacturer" basis to MRI device manufacturers. A Medrad MRI injection system under development is expected to be introduced worldwide later this year.

Under terms of the approximately $180 mil. cash deal, signed and approved Aug. 22, a tender offer will be made "in the near future" through a U.S. Schering affiliate for all outstanding Medrad shares at $28 per share. The purchase price represents a 26% premium over Medrad's Aug. 22 closing price of 22-1/4. MedRad has approximately 5.9 mil. shares outstanding. The remaining cash goes for buying out options and other expenses.

Schering AG operates in the U.S. through Cedar Knolls, N.J.-based Berlex Laboratories. Pittsburgh-based Medrad and Berlex both would be subsidiaries of Schering Berlin, the U.S. holding company of Schering AG Germany, upon completion of the deal. Medrad sales for fiscal 1995 (ended Jan. 31) totaled $78.3 mil.

Medrad currently markets its syringes empty, although it does have non-exclusive marketing agreements with the Norwegian firm Hafslund Nycomed and the Italian firm Bracco for pre-filled contrast agent syringes that are under development. Medrad said it anticipates no major changes in management or structure following the acquisition. Medrad will remain under the leadership of CEO Thomas Witmer. The company employs 725 people.