Arbor Pharma buys XenoPort for $467 million
- Arbor Pharma is buying Santa Clara, CA-based XenoPort for $467 million, the companies said Monday. The price per share of $7.03 represents a 60% premium over Friday's closing price of $4.40.
- For the past several months, XenoPort has been divesting its portfolio in order to better focus on its main drug, Horizant. In March, it sold to Dr. Reddy's a psoriasis drug-in-development, which had once been considered a promising candidate.
- XenoPort has seen its fortunes decline substantially since January 2008 when the stock was flying high at $61 per share.
XenoPort's only approved drug, Horizant (gabapentin) for treatment of restless leg syndrome, is a key part of Arbor's acquisition. XenoPort had high hopes for Horizant but slow sales following a 2011 approval led GlaxoSmithKline to pull out as co-marketing partner, as Xconomy notes.
The company tried to gain a second indication for Horizant for alcohol use disorder but ran out of money before it was able to complete clinical development.
Last year, Horizant generated $41.2 million in sales, but the increased focus on marketing the drug has led the company to forecast sales of $60 million to $65 million this year.
Arbor appears to share that confidence. "The XenoPort sales team has done an excellent job of growing Horizant, and we look forward to supporting them to continue this significant momentum," said Arbor CEO Ed Schutter.
The transaction is expected to close sometime in the third quarter.