Endo lands a big fish with $8 billion Par Pharma deal
pharmafile | May 19, 2015 | News story | Sales and Marketing | Endo, Valeant, par pharma
Endo is switching strategies from attempting to buy specialist pharma firms, to generics, having announced a huge $8 billion deal to buy Par Pharmaceuticals.
The Irish firm which lost out to Valeant in a failed bid to buy specialist gastrointestinal drug company Salix Pharma, is now banking on boosting its generics sales to drive its long-term growth.
Endo says the acquisition “will create a leading speciality pharmaceutical company with a generics business that is one of the industry’s fastest growing, and among the top five as measured by US sales”.
It adds that the purchase of Par “is also expected to help drive long-term double-digit revenue growth for Endo”.
Par Pharmaceuticals is a privately-held company that produces generic and branded drugs. In March it filed a registration statement with the US Securities and Exchange Commission relating to a proposed initial public offering as part of a stock market launch.
The purchase price negotiated with Endo will consist of approximately 18 million shares ($1.55 billion of value based on the 10-day volume weighted average share price of Endo ending on 15 May 15, 2015) of Endo equity and $6.50 billion cash consideration to Par shareholders.
The acquisition is the firm’s bid to ‘reshape the generics pharma landscape’ with a significant pipeline injection. Par has more than 200 Abbreviated New Drug Applications (ANDAs), 115 of which were filed with the FDA as at the end of last year.
A third of these are potentially first-to-file or first-to-market opportunities. Endo chief executive and president Rajiv De Silva said he expects the firm’s generics arm, Qualitest, “to become one of the largest and fastest growing in the industry”.
“Our generics business Qualitest continues to be an extremely attractive and effective growth driver for Endo. This transaction with Par builds upon our generics growth, adding a strong portfolio of high barrier-to-entry and attractive gross margin products while also transforming Endo, creating a powerful corporate platform for future growth and strategic M&A,” De Silva comments.
He adds: “We believe the acquisition of Par underscores the continued execution of Endo’s value-driven M&A strategy and helps deliver on our goal of achieving double-digit revenue growth for the overall business over the long-term.”
Paul Campanelli, chief executive officer of Par Pharmaceutical, says: “This is an exciting time of growth and opportunity in the generics and specialty pharmaceutical arenas. We share Endo’s goal of developing and commercialising generic drugs in areas of greatest revenue potential, complex formulations and longer life cycles.”
Lilian Anekwe
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