Rx Label produced pressure sensitive prescription labels for mass merchandisers, grocery stores, drug stores, independent pharmacies, hospitals, and other customers.
The company was formed in 2004 when we combined with Hilco Equity Partners, L.P. to acquire the pharmaceutical labeling assets of Convergent Label Technology, Inc., a subsidiary of a significantly larger diversified label company. We were introduced to the company by Hilco, who wanted a partner to add the operational capabilities necessary to manage the carve out and transition of the Rx label business from its distressed parent.
Rx Label was a market leader in a high growth sector of the economy. Primary demand drivers included an aging baby boomer population, evolving, more stringent healthcare regulations and increased demand for lifestyle drugs such as those treating hair loss, impotency and obesity. The company was in a high margin niche segment of the pharmacy label market and significant channel penetration opportunities existed through mail order, hospitals and retail pharmacies, including Target, Walgreens and Rite Aid. They were recognized as a market innovator with a broad product offering, and had several patented and patent-pending technologies, producing all three primary prescription label technologies (simplex, duplex and thermal labels). The facility was well managed, with a strong plant manager and talented workforce, but would need significant expansion and added management resources to catalyze future growth.
Within six months post-acquisition, the company was converted into a stand-alone business. This required the doubling in size of its existing Joplin facility, consolidating and moving production lines held at a legacy parent company location into the Joplin operation, creating a new stand-alone MIS system, hiring a senior management team and implementing rewards and merit-based compensation programs. To complete the transition, the company fostered a continuous improvement culture, training six team leaders that facilitated more transparent communication across all levels of the organization and focused on workforce safety improvement initiatives.
Headquarters: Joplin, Missouri
Industry: Prescription Label Manufacturing
Acquired: June 2004
Divested: July 2006
Case studies have been selected for illustrative purposes only. The specific portfolio companies identified are not representative of all active or prior Pfingsten portfolio companies; results may not be typical and it should not be assumed that investments in other portfolio companies will be or were as profitable. Investment in a fund involves significant risk, including loss of the entire investment.