AAIPharma Services Corp., a leading provider of pharmaceutical product development services, announced today it has acquired Celsis Analytical Services, a division of Celsis International Ltd. that performs material testing services for the pharmaceutical, biotechnology and manufacturing sectors.

“The addition of Celsis Analytical Services will enable AAIPharma to expand its market presence in two key regions. Our combined company will bring a differentiated offering to the contract services market with an integrated development and material testing service model,” said Patrick Walsh, CEO of AAIPharma. “We are excited to integrate Celsis labs’ business with AAIPharma, creating one of the largest and most experienced materials testing businesses in the U.S.” Celsis Analytical Services provides cost-effective, outsourced cGMP-certified laboratory services with industry-leading sample turnaround times at its laboratory operations in Edison, N.J. and St.

Louis. Both testing centers, comprising 65,000 square feet of laboratory facilities, will be additive to AAIPharma’s existing 300,000 square feet of facilities. The combined entity offers a comprehensive menu of methods validation and testing services for biotechnology, pharmaceutical and consumer products manufacturers, raw materials suppliers and manufacturers of agricultural and veterinary medicine products.

“Celsis Analytical Services and AAIPharma have very complementary client bases and can provide a comprehensive range of testing services to the growing pharmaceutical and biotechnology outsourcing market,” said Jay LeCoque, CEO of Celsis International Ltd. “This acquisition will enable each of the locations to participate more fully in the growth of the contract services market and to enjoy the synergies offered by the larger combined company.” “The material testing market is highly fragmented,” added Walsh.

“AAIPharma is responding to our diverse customer groups’ growing preference to consolidate their outsourced services with fewer vendors. We recognize the opportunity to provide high quality, responsive and scalable services, and this acquisition is an example of our making substantial capital investments in equipment, facilities and capabilities.” Terms of the deal were not disclosed. In 2009, AAIPharma was acquired by Water Street Healthcare Partners, a strategic private equity firm focused exclusively on the health care industry. Water Street has invested in the company to expand its capabilities and services to customers.

Brown Gibbons Lang & Company represented Celsis International Ltd. in the transaction.