Date: 2013-01-24
Type of information: Product acquisition
Compound: OBI-1, a recombinant porcine factor VIII (rpFVIII) and Ipsen’s industrial facility in Milford
Company: Ipsen (France) Inspiration Biopharmaceuticals (USA) Baxter (USA)
Therapeutic area: Hematologic diseases - Genetic diseases
Type agreement: asset purchase
acquisition
Action mechanism:
Disease: congenital hemophilia A with inhibitors and acquired hemophilia A
Details: Ipsen and Inspiration Biopharmaceuticals have announced they entered into an Asset Purchase Agreement (APA) whereby Baxter agrees to acquire the worldwide rights to OBI-1, a recombinant porcine factor VIII (rpFVIII) in development for congenital hemophilia A with inhibitors and acquired hemophilia A, and Ipsen’s industrial facility in Milford (Boston, MA). Last November, Inspiration has received Fast Track designation from the FDA for OBI-1 in acquired hemophilia A. OBI-1 received Orphan Drug Designation from the FDA in March 2004 and from the European Medicines Agency (EMA) in October 2010.
Last year, Ipsen and Inspiration have renegotiated their 2010 partnership. On 30 October 2012, Inspiration has filed for bankruptcy. The company has announced it was seeking a strategic buyer. Ipsen's commercialization rights obtained from Inspiration in August 2012 were included in the sale, as well as Ipsen’s OBI-1 manufacturing facility in Milford. Ipsen is seeking to exit hemophilia through this process.
Evercore Partners served as exclusive financial advisor to Inspiration and Ipsen on the transaction.
Financial terms: The APA was filed, 23 January 2013, with the US Federal Bankruptcy in Boston. The sale is a result of joint marketing and sale process pursued by Ipsen and Inspiration shortly after Inspiration filed for protection under Chapter 11 of the U.S. Bankruptcy Code on October 30, 2012. Ipsen has been providing Inspiration with Debtor-in-Possession financing (DIP) for an amount of up to $18.3 million in order to permit the sale process to proceed. Under the terms of the APA, Baxter has agreed to pay $50 million upfront, up to $135 million in potential additional development and commercial milestones as well as tiered net sales payments ranging from 12.5% to 17.5% of OBI-1 annual net sales. The APA is subject to certain closing conditions, including Bankruptcy Court and regulatory approvals. Ipsen has agreed to extend the DIP to Inspiration for a period of 45 days i.e. for an additional amount of up to c. $5 million.
The sale process for IB1001, a recombinant factor IX (rFIX) for the treatment and prevention of bleeding in patients with hemophilia B is separate and in the final bidding stage.
As Inspiration’s only senior secured creditor and as the owner of non-Inspiration assets that will be included in the sale of both OBI-1 and IB1001, Ipsen will receive approximately 60% of the upfront payments. Over and above these upfront amounts, Ipsen will receive 80% of all payments up to a present value of $304 million and 50% of all proceeds thereafter.
On the basis of available information, the share of upfront payment to be received by Ipsen should mainly cover the total amount of DIP financing provided to Inspiration. The remaining portion of proceeds is contingent on OBI-1’s approval. As a consequence, the Group, as of 31 December 2012, may impair hemophilia related assets (mainly composed of the convertible bonds and the Milford manufacturing site) for a total amount of around €100 million after tax.
Latest news: * On March 21, 2013, Ipsen and Inspiration Biopharmaceuticals have announced the closing of the sale of its lead hemophilia program, OBI-1 to Baxter. Baxter has now acquired worldwide rights to this recombinant porcine factor VIII in development for the treatment of congenital hemophilia A with inhibitors and acquired hemophilia A, as well as Ipsen’s manufacturing facility for OBI-1 in Milford, Massachusetts. The Ipsen employees working on the development and manufacturing of OBI-1 are offered employment by Baxter.
This closing completes the joint sale process pursued by Inspiration and Ipsen shortly after Inspiration filed for protection under Chapter 11 of the U.S. Bankruptcy Code on October 30, 2012.
