- Less than a full 48 hours after Sprout Pharmaceuticals won FDA approval for the first-ever women's libido-boosting drug (Addyi) in the U.S., serial-acquirer Valeant Pharmaceuticals announced that it has struck a deal to buy out the company for $1 billion.
- The acquisition will include a $500 million cash payment upfront and another $500 million installment next year.
- Valeant expects the deal to clear by Q3 2015 and will share profits with Sprout if Addyi achieves certain milestones. The closely held North Carolina-based Sprout will become a fully owned division of Valeant and the former's leadership team will be incorporated into the company.
It seems that M&As move at the speed of light these days in biopharma—and who better to follow through on a quick snap-up than Valeant, a company whose stated strategy is to diversify and grow through targeted acquisitions.
Just in the last 12 months, Valeant has struck deals with Egyptian pharma giant Amoun, prostate cancer med Provenge maker Dendreon, and stomach/bowel specialist Salix. Now, the company is widening its reach in the consumer market with a nominally historic (and quite controversial) female sexual dysfunction medication. Valeant is likely better suited to deal with Addyi's boxed warning about blood pressure drops and fainting with alcohol use and certain other medications, and the company is expecting modest revenue increases this year from the acquisition (the drug doesn't launch until October).
"Valeant expects Addyi to be available in the United States in the fourth quarter of 2015 through prescribers and pharmacies that have been certified under the U.S. FDA's comprehensive Risk Evaluation and Mitigation Strategy (REMS) program to assure safe use," said the company in a statement. "Following the closing of the transaction, Valeant, under the REMS, will offer physicians and pharmacists the required certification programs for prescribing and dispensing Addyi."
Stay tuned for an in-depth look at the issues surrounding Addyi, sales and market uptake expectations, and more on Friday.