The M&A train rolls on: Teva to buy American CNS drug maker for $3.2B
- Israeli pharma giant Teva will purchase California-based Auspex Pharmaceuticals for about $3.2 billion in cash, or $101 per share.
- Including debt, the deal is worth about $3.5 billion (although Teva will not be taking on any new debt in order to finance the deal).
- Auspex focuses on drug for central nervous system disorders such as Huntington's disease, Tourette's syndrome, and tardive dyskinesia. Notably, the company doesn't have any products on the market just yet, although a Huntington's drug is expected to launch as early as next year.
Can anything stop biopharma's M&A trend? It seems unlikely for the foreseeable future. Monday saw the announcement of both the Teva-Auspex deal and Horizon's announcement that it would be purchasing Hyperion and its orphan drug franchise.
The Teva deal is notable since it shows the company's desire to diversify in order to bolster its pipeline and, in the company's words, mid- to long-term revenues. Some industry observers suspected such a move may have been on the cards for Teva after rumors that the generics powerhouse would try to make a play for Mylan were shut down (though such a deal is still not completely out of the question).
Both Teva and Auspex execs lauded the possibilities from the deal.
"The acquisition of Auspex is a significant step in strengthening Teva’s leadership position in C.N.S. and advances us into underserved movement disorder markets," said Teva CEO Erez Vigodman in a statement. "This transaction represents a first major step with regards to that commitment, and we expect to continue this focus in the future."
"This transaction will enhance Auspex’s mission by bringing innovative therapies to patients across the world as quickly and efficiently as possible," added Auspex chief Pratik Shah. "The transaction also marks a great outcome for Auspex shareholders and stakeholders as it not only validates our portfolio of drug candidates while delivering significant financial return, but it also puts our programs into the hands of a company that has the experience and commitment to deliver our pipeline of therapies to patients in need."