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The M&A roundup
While the Mylan-Perrigo-Teva triad is dominating much of the merger and acquisition talk recently (read the “Two’s company; three’s a crowd? ” article from our May 2015 issue for more on that), it isn’t the only news on the M&A front lately. In fact, we’ve gathered so many leads from late March through early April that we needed a roundup-style article to cover them all.
Teva reinforces position in CNS with Auspex acquisition
JERUSALEM & LA JOLLA, Calif.—Teva Pharmaceutical Industries Ltd. and Auspex Pharmaceuticals Inc. announced near the end of March that they have entered into a definitive merger agreement under which Teva will commence a tender offer for all of the outstanding shares of Auspex, for a total consideration of approximately $3.2 billion in enterprise value and approximately $3.5 billion in equity value.
This transaction is expected to enhance Teva’s revenue and earnings growth profile and strengthen its core central nervous system franchise with the addition of Auspex’ portfolio of innovative medicines for people who live with movement disorders.
Auspex is a biopharmaceutical company specializing in applying deuterium chemistry to known molecules to create novel therapies with improved safety and efficacy profiles. Its lead investigational product, SD-809 (deutetrabenazine) is being developed for the potential treatment of chorea associated with Huntington’s disease, tardive dyskinesia and Tourette syndrome, with a pharmacokinetic profile that allows for lower doses resulting in a favorable safety profile.
In 2014, Auspex reported positive results from its Phase 3 clinical trial for SD-809 in Huntington’s disease, with plans to submit a New Drug Application for this indication by mid-2015. SD-809 has been granted Orphan Drug Designation for the treatment of Huntington’s disease by the U.S. Food and Drug Administration, and Auspex expects regulatory approval and commercial launch for this indication in 2016 in the United States.
“Teva is well positioned to realize the robust IP potential of these investigational products with Auspex’ deuterated technology which could represent a significant breakthrough for patients who often have no sustainable symptom relief from their disease,” said Dr. Michael Hayden, Teva’s president of global research and development and chief scientific officer.
Horizon to acquire Hyperion for $1.1 billion
DUBLIN & BRISBANE, Calif.—The end of March saw Horizon Pharma plc and Hyperion Therapeutics Inc. announce they have entered into a definitive agreement under which Horizon Pharma will acquire all of the issued and outstanding shares of Hyperion’s common stock for $46 per share in cash, or approximately $1.1 billion on a fully diluted basis. The per-share consideration represents a premium of approximately 35 percent to Hyperion’s volume weighted average price for the trailing 60 days. The deal was expected to close in the second quarter of this year.
“The Hyperion acquisition will expand and diversify our product portfolio by adding two complementary orphan disease products, Ravicti and Buphenyl, and leverage as well as expand the existing infrastructure of our orphan disease business,” said Timothy P. Walbert, chairman, president and CEO of Horizon Pharma. “This transaction will be immediately accretive to adjusted EPS, and we expect the contribution of Ravicti and Buphenyl in 2016 will add approximately $100 million to our adjusted EBITDA, including cost synergies contributing greater than $50 million. Additionally, this acquisition further accelerates our near- and long-term sales and adjusted EBITDA growth and provides significant value for both Horizon and Hyperion shareholders.”
Ravicti and Buphenyl are medicines for people with urea cycle disorders (UCDs), a collection of inherited metabolic disorders that impact approximately 2,100 people in the United States, with approximately 1,100 diagnosed. A marketing authorization application has been filed for European marketing of Ravicti. The prevalence of UCD is similar in Europe and other international markets.
Celgene to acquire Quanticel Pharmaceuticals
SUMMIT, N.J. & SAN DIEGO—Celgene Corp. and Quanticel Pharmaceuticals Inc., a privately held biotechnology company focused on cancer drug discovery, announced on April 27 a definitive share purchase agreement under which Celgene will acquire Quanticel. Quanticel will receive an upfront payment of $100 million and contingent fees of as much as $385 million.
Through the agreement, Celgene will have full access to Quanticel’s proprietary platform for the single-cell genomic analysis of human cancer, as well as Quanticel’s lead programs that target specific epigenetic modifiers to advance Celgene’s pipeline of innovative cancer therapies.
The acquisition culminates a 2011 strategic alliance between Celgene and Quanticel. Over the course of the three-and-a-half-year alliance, Quanticel industrialized its single-cell platform for analysis of tumor cellular content and applied it to novel target discovery and the generation of high-quality drug candidates. Multiple drug candidates from Quanticel are expected to enter the clinic in early 2016.
“This acquisition brings into Celgene a highly productive, innovative organization deploying a unique platform of high strategic value” said Dr. Tom Daniel, president of research and early development for Celgene. “More than acquiring the great team, the novel technology and the drug candidates, the deal validates an innovative approach to building organizational capabilities.”
Protea to acquire vivoPharm
MORGANTOWN, W.Va.—Protea Biosciences Group Inc. announced this spring that it had entered into an agreement for the purchase of vivoPharm Pty Ltd., a global provider of pharmacology, toxicology and bioanalytical research services, with a portfolio of proprietary oncology models. Upon completion of the acquisition, vivoPharm will operate as a business unit of Protea—viviPharm has facilities in Melbourne, Australia, and Hershey, Pa., along with a sales office in Munich, Germany.
Protea’s Chairman and CEO, Mr. Stephen Turner stated, “The combined company will offer a unique, proprietary suite of services and bioanalytic technologies for the biotechnology and pharmaceutical industries. With the combination of our two companies, we are seamlessly integrating revolutionary molecular information technologies with world-class oncology models and in-vivo testing capabilities, to create new, unmatched and superior services for the preclinical pharmaceutical market.”
Dr. Ralf Brandt, founder and CEO of vivoPharm, added, “Joining forces with Protea provides a fantastic opportunity to build vivoPharm’s business, and provides a major point of differentiation from other preclinical research services. The opportunities to apply Protea’s mass spectrometry imaging workflows directly to in vivo animal studies represent a potential game-changer for the overall pharmaceutical and biotech R&D space.”
Fujifilm steps up to buy Cellular Dynamics
TOKYO and MADISON, Wis.—Fujifilm Holdings Corp. and Cellular Dynamics International Inc. (CDI), a leading developer and manufacturer of fully functioning human cells in industrial quantities to precise specifications, recently announced that the two companies had entered into a definitive agreement whereby Fujifilm would acquire CDI via an all-cash tender offer to be followed by a second-step merger. Fujifilm aims to acquire all issued and outstanding shares of CDI’s common stock for $16.50 per share or approximately $307 million (on a fully diluted basis). The transaction was completed May 1. CDI will continue to run its operations in Madison and in Novato, Calif., as a consolidated subsidiary of Fujifilm.
CDI’s technology platform enables the production of high-quality fully functioning human cells, including induced pluripotent stem cells (iPSCs), on an industrial scale. Customers use CDI’s products, among other purposes, for drug discovery and screening, to test the safety and efficacy of their small molecule and biological drug candidates, for stem cell banking and in the research and development of cellular therapeutics. CDI’s proprietary iCell product catalogue encompasses 12 different iPSC based cell types, including iCell Cardomyocytes, iCell Hepatocytes, and iCell Neurons. During 2014 CDI sold to 18 of 20 top biopharmaceutical companies.
This acquisition of CDI will allow Fujifilm to gain entry into the area of iPS cell-based drug discovery support services. Fujifilm also plans to benefit from the combination of CDI’s iPS cell technology and experience and Fujifilm’s expertise in material science, engineering and quality management systems. The combination of these is expected to help accelerate product development in regenerative medicine while expanding the commercial opportunities.