Based on two sites in the Boston, Massachusetts area and employing around 120 people, Pharm-Eco provides contract research, process development and small scale synthesis services to the pharmaceutical industry. Its turnover in the financial year ended 31st December 2000 was $17 million.

Pharm-Eco's services are primarily focussed on drug development from discovery through to Phase II clinical trials. These services complement Johnson Matthey's Pharmaceutical Materials business, based at West Deptford, New Jersey, which manufactures active pharmaceutical ingredients for drugs that are already approved for market or are very near to receiving final approval.

The acquisition presents Johnson Matthey with enhanced opportunities to bring new pharmaceutical manufacturing business to the West Deptford facility, which is currently undergoing a major programme of expansion, and considerably extends its existing portfolio of products and services for customers in the pharmaceutical industry.

The acquisition of Pharm-Eco is expected to be earnings neutral in Johnson Matthey's current financial year and earnings enhancing thereafter.

Commenting on the acquisition, Chris Clark, Chief Executive of Johnson Matthey said:

"Niche acquisitions in our core business areas are in line with our strategy for growth. We are also investing heavily in our existing businesses. The acquisition of Pharm-Eco represents an excellent opportunity to further expand our activities in the rapidly growing pharmaceutical materials market."

Forrest Sheffy, Vice President and General Manager, Pharmaceutical Materials, said:

"Pharm-Eco has a strong customer base and an outstanding reputation for the quality of its service throughout the pharmaceutical industry. The acquisition fits well with our existing activities in pharmaceutical materials."