Teva and Horizon acquisitions maintain sector spree
The pharma sector's run of merger and acquisitions continues, with two new deals worth $1 billion-plus from Teva and Horizon announced yesterday.
While the announcements weren't among the biggest, they show that the appetite for further consolidation and deal-making remains strong in the sector.
Teva announced it is to spend $43.5 billion on US firm Auspex, helping it to increase its presence in central nervous system therapy areas.
Teva is the world's largest maker of generic medicines, but also has a presence in R&D-based products, led by multiple sclerosis drug Copaxone, but this is facing increasing competition.
The multi-billion dollar acquisition is the first major strategic move for new chief executive, Erez Vigodman, who was appointed in January 2014 to turn around the business' fortunes after several years of turmoil in the boardroom.
Auspex's lead product candidate is SD-809, being developed to treat chorea, the abnormal involuntary movement associated with Huntington's disease, tardive dyskinesia and Tourette's syndrome. The molecule is expected to win regulatory approval to treat Huntingdon's disease and be launched commercially in 2016.
Michael Hayden, Teva's chief scientific officer, said Auspex's technology could represent "a significant breakthrough for patients who often have no sustainable symptom relief from their disease".
An estimated 30,000 people in the US have Huntington's, 350,000 have tardive dyskinesia and 150,000 are diagnosed with Tourette's for which the drug is in early stage trials. Auspex has another drug being developed for Parkinson's disease, and Teva forecasts the firm's product could generate $2 billion by 2020.
Analysts believe that the size and type of the deal means it is just the first of many, with observers expecting the firm to seek out a 'transformative' deal within the generics sector. Most speculation is around a bid for rivals Mylan, which would require a much bigger outlay.
Erez Vigodman, chief executive of Teva said: "As we have outlined recently, one of our key priorities for 2015 is to support Teva's mid- to long-term growth and create value for our shareholders with business development opportunities that are closely aligned with our core therapeutic areas.
"This transaction represents a first major step with regards to that commitment and we expect to continue this focus in the future," he said.
Horizon buys Hyperion
Meanwhile California-based specialist pharma company Horizon Pharma is to pay $1.1 billion for Hyperion, based in Dublin, Ireland.
Horizon already has an orphan disease drug business, making the acquisition of Hyperion's two approved drugs Ravicti and Buphenyl for rare, urea-cycle disorders a complementary move.
