GERMANY —3M, a global leader in innovation has reached an agreement to sell certain assets associated with its dental local anesthetic portfolio based in Seefeld, Germany, to Pierrel S.p.A., a global provider of services for the pharmaceutical industry.

The purchase price is set at US$70 million, subject to closing and other adjustments.

The local anesthetic products sold by 3M are primarily distributed in Europe and Asia under the Ubistesin, Xylestesin, and Mepivastesin brands, which include related syringe and needle products. These products are part of the dental materials business in 3M’s Oral Care Solutions Division.

Karim Mansour, President of 3M Oral Care Solutions Division, stated that the divestiture of these products is part of 3M’s ongoing strategic portfolio management to exit certain products and prioritize investments that leverage its Health Care business’ core Oral Care technologies.

3M’s local anesthetic products generated approximately US$30 million in annual sales in 2022, and their impact on ongoing operations was not material to 3M’s financial results.

The transaction, which is subject to information or consultation requirements with relevant works councils and other closing conditions, is expected to be completed in the third quarter of 2023.

3M will provide transition support to Pierrel to ensure a smooth transition for customers.

3M will retain ownership of its Seefeld facility and operations, which support 3M’s Oral Care business.

The company has been focusing on exiting certain products and investing in high-growth end markets where 3M science gives it a clear competitive advantage.

According to CEO Mike Roman, these emerging growth areas include “climate technology, sustainable packaging, industrial automation, semiconductors, and next-generation consumer electronics.”

3M has been implementing a restructuring plan to make the company “stronger, leaner, and more focused.”

The plan involves eliminating 6,000 positions across all functions and geographies, separate from the 2,500 manufacturing job cuts announced in January 2023.

These layoffs are expected to save the company upwards of US$900 million annually. Despite a 9% year-over-year dip in sales, 3M reported a first-quarter profit of US$976 million.

At the same time, 3M has announced that it plans to split off its healthcare business into a separate, publicly traded company.

This new venture will focus on a range of healthcare products including wound and oral care, healthcare IT, and biopharma filtration.

Among the products included in the spin-off are bandages, skin adhesives, oral aligners, air purifiers, and optical lenses.

In recent years, 3M’s healthcare division has been a key growth area for the company, with sales of more than US$8 billion in 2021.

By separating the division from the main company, 3M hopes to unlock additional value for its shareholders while enabling the healthcare business to focus on its core competencies.

However, the healthcare division is not without its challenges. One notable example is the Bair Hugger surgical warming system, which is currently the subject of nearly 6,000 lawsuits.

While 3M maintains that the product has no relation to surgical-site infections, the legal action has put a spotlight on the risks that companies in the healthcare industry face.

Despite these challenges, 3M is optimistic about the potential of the new healthcare company. By spinning off the division, the company aims to provide greater transparency and accountability, as well as more focused investment in the healthcare space.

The transaction is expected to be completed by the end of this year, with 3M retaining a 19.9% stake in the new company.

In addition to the healthcare spin-off, 3M is also spinning off its food safety business with Neogen in September last year in a US$9.3 billion deal.

These moves are part of a broader effort by 3M to streamline its operations and focus on high-growth areas, such as climate technology, sustainable packaging, industrial automation, semiconductors, and next-generation consumer electronics.

For all the latest healthcare industry news from Africa and the World, subscribe to our NEWSLETTER, and YouTube Channel, follow us on Twitter and LinkedIn, and like us on Facebook.