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OPKO opts for PROLOR
June 2013
by Kelsey Kaustinen  |  Email the author
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MIAMI—Pharmaceutical and diagnostics company OPKO Health Inc. and PROLOR Biotech Inc., a Nes-Ziona, Israel-based clinical-stage biopharmaceutical company, have announced the signing of a definitive merger agreement by which OPKO will acquire PROLOR in an all-stock transaction. Both companies' boards of directors have approved the transaction.  
 
Per the terms of the definitive merger agreement, PROLOR common stock holders will receive 0.9951 shares of OPKO common stock for each share of PROLOR stock they hold. Based on an OPKO share price of $7.03 per share, the transaction has an approximate total of $480 million, or $7 per share of PROLOR common stock. The closing of the transaction, which is subject to approval from both companies' stockholders as well as other customary closing conditions, is expected to be completed in the second half of 2013.  
 
"We believe this transaction recognizes the value we have created at PROLOR and provides our shareholders with attractive economic terms, as well as the opportunity to continue to share in the success of the combined company," Shai Novik, president of PROLOR, said in a press release. "We believe that OPKO's track record of commitment to innovation and growth, along with its diversified portfolio of innovative therapeutic and diagnostic products, growing international presence, ongoing investments in commercial infrastructure and highly experienced management team, make this combination an excellent fit for PROLOR."  
 
PROLOR applies unique technologies, including its Carboxyl Terminal Peptide (CTP) technology, in the development of proprietary, longer-acting versions of already approved therapeutic proteins. PROLOR 's CTP technology, when attached to a therapeutic protein, significantly extends the duration of the protein's activity in the body, and clinical and preclinical studies have shown the technology to be safe and effective.
 
The company is currently developing a long-acting version of human growth hormone, hGH-CTP. The treatment has completed four clinical trials, in which it has demonstrated the potential to reduce dosing frequency from a daily injection to a single weekly injection. hGH-CTP has been granted orphan drug designation in both the United States and Europe for adults and children with GHD. PROLOR is also developing a long-acting version of GLP-1/Glucagon dual receptor agonist for the treatment of type II diabetes and obesity, as well as long-acting versions of Factor VIIa-CTP and Factor IX-CTP for the treatment of hemophilia. All versions are being developed to require only one or two injections per week.  
 
"This transaction is consistent with OPKO's stated objective of broadening our portfolio of market-transforming therapies in selected specialty markets," Dr. Phillip Frost, chairman and CEO of OPKO, commented in a statement. "With the inclusion of PROLOR's pipeline, OPKO will have four significant products in Phase III clinical development and a robust pipeline of important therapeutic and unique diagnostic products in various stages of development. PROLOR's drug-product candidates for growth hormone deficiency, hemophilia, obesity and diabetes, along with its broadly applicable technology platforms and efficient research and development center are highly valuable assets that will complement OPKO's strategy."
 
 
The acquisition is one of several transactions OPKO has made already this year. OPKO began with the acquisition of Silcon Comércio, Importacao E Exportacao de Produtos Farmaceuticos e Cosmeticos Ltd. in February. In March, OPKO acquired Markham, Canada-based Cytochroma Inc., which gained the company two Phase III products: a vitamin D pro-hormone for the treatment of secondary hyperparathyroidism in patients with stage III or IV chronic kidney disease and vitamin D insufficiency, and a potent non-absorbed phosphate binder for the treatment of hyperphosphatemia in chronic kidney disease patients on chronic hemodialysis.
 
OPKO enlisted Barrington Research Associates Inc. as its financial advisor for the transaction, with Akerman Senterfitt acting as its legal advisor. PROLOR brought on Jefferies LLC as financial advisor and Greenberg Traurig PA as its legal advisor, while the Strategic Alternatives committee enlisted Jefferies LLC for financial advice, Oppenheimer & Co. for a fairness opinion and DLA Piper LLP for legal advice.
 
Code: E061308

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