Print“We do still have a very substantial war chest, a lot of cash on hand which we can use to find deals—both large U.S. deals, or if appropriate global deals or deals that are even more regional.”
Forest Laboratories will pay $1.2 billion to acquire Clinical Data and its newly approved antidepressant, Viibryd, a year ahead of looming generic competition for Lexapro, its blockbuster depression drug that loses patent protection in 2012.
The deal provides a $30 per share payment Clinical Data investors and up to $6 per share more if Viibryid achieves certain undisclosed commercial milestones. Though Viibryd is not touted as a revolutionary new drug, the market for treating major depressive disorder is more than 200 million prescriptions strong annually and growing. Given that people often switch antidepressants in search of the best-suited treatment for their illness, it is easier for newly approved drugs to gain a foothold in the category.
“This transaction is consistent with our strategy to acquire new products that will help offset the loss of revenues due to upcoming patent expiries,” the companys says.
Forest plans to launch Viibryd in the United States during the second half of 2011 with a significant marketing and sales investment. And while it aleady has a salesforce in place to support its portfolio of relatively young products, the company plans to expand its sales staff with as many as 300 new hires to support the Viibryd rollout, according to Medical Marketing and Media magazine.
Forest says the acquisition will be dilutive to its earnings per share for the next three fiscal years, but may become accretive during fiscal 2014. Nonetheless, it has no plans to hold back if attractive new opportunities present themselves in the meantime.
“There continues to be a very strong interest and appetite for deals that can help to grow the business in our post-Lexapro and ultimately post-Namenda lines,” says David Solomon, Forest’s SVP of corporate development and strategic planning. “We do still have a very substantial war chest, a lot of cash on hand which we can use to find deals—both large U.S. deals, or if appropriate global deals or deals that are even more regional.”
February 24, 2011
http://www.burrillreport.com/article-forest_nabs_clinical_data_for_1_2_billion.html
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