Date: 2014-07-02
Type of information: Company acquisition
Acquired company: Furiex Pharmaceuticals (USA - NC)
Acquiring company: Forest Laboratories (USA - NJ), an Actavis\' subsidiary (Ireland)
Amount: $1.1 billion, and up to approximately $360 million in a Contingent Value Right (CVR)
Terms: * On July 2, 2014, Actavis announced that its subsidiary Forest Laboratories, has successfully completed its acquisition of Furiex Pharmaceuticals in an all-cash transaction valued at approximately $1.1 billion, and up to approximately $360 million in a Contingent Value Right (CVR) that may be payable based on the status of eluxadoline, Furiex\'s lead product, as a controlled drug following approval. In connection with the close of the Furiex acquisition, Actavis further announced that it has closed the transaction related to the sale of Furiex\'s royalties on alogliptin and Priligy® to Royalty Pharma for approximately $415 million. * On July 1, 2014, the stockholders of Furiex Pharmaceuticals voted at a special meeting of stockholders to adopt the previously announced agreement and plan of merger, dated as of April 27, 2014, providing for the merger of Furiex with an entity now controlled by Forest Laboratories, a subsidiary of Actavis. Actavis completed its acquisition of Forest Laboratories, Inc. on July 1, 2014. The votes cast by Furiex\'s stockholders in favor of the proposal to adopt the merger agreement represented approximately 79.85% of Furiex\'s issued and outstanding common stock entitled to vote as of May 29, 2014, the record date for the special meeting. Furiex also announced that it has received notice of clearance of the proposed merger from the Ukrainian Antimonopoly Committee. The receipt of the approval of Furiex\'s stockholders of the proposal to adopt the merger agreement and clearance by the Ukrainian Antimonopoly Committee satisfy two of the conditions to consummation of the proposed merger. The consummation of the merger remains subject to certain other closing conditions set forth in the merger agreement and discussed in detail in the definitive proxy statement filed with the U.S. Securities and Exchange Commission by Furiex on June 4, 2014 and supplemented on June 23, 2014, but is expected to occur in the near future * On April 28, 2014, Forest Laboratories and Furiex Pharmaceuticals announced that Forest has entered into a definitive agreement to acquire Furiex, a drug development collaboration company, for $95 per share, or approximately $1.1 billion in cash, and up to $30 per share (approximately $360 million in aggregate) in a Contingent Value Right (CVR) that may be payable based on the status of eluxadoline, Furiex\'s lead product, as a controlled drug following approval. The acquisition is subject to receipt of customary regulatory approvals and approval by Furiex shareholders. Forest concurrently announced that it has entered into an agreement with Royalty Pharma to sell Furiex\'s royalties on alogliptin and Priligy® to Royalty Pharma for approximately $415 million upon successful completion of Forest\'s acquisition of Furiex. Forest\'s acquisition of Furiex is not contingent on Forest\'s agreement with Royalty Pharma. Forest expects to divest Furiex\'s royalties on alogliptin and Priligy® to Royalty Pharma for a payment of approximately $415 million, which, after tax, will effectively reduce Forest\'s purchase price by approximately $315 million. Forest expects to use cash on hand to fund the acquisition of Furiex. Forest\'s planned acquisition of Furiex is expected to close in the second or third quarter of 2014 pending regulatory review and Furiex shareholder approval and is not expected to affect the timing of Actavis plc\'s previously announced acquisition of Forest. Actavis has consented to Forest\'s acquisition of Furiex and supports the transaction. Covington & Burling LLP served as Forest\'s legal counsel, Furiex was advised by Kirkland & Ellis LLP and Wyrick Robbins Yates & Ponton LLP, and Royalty Pharma was advised by Goodwin Procter LLP. BofA Merrill Lynch and Credit Suisse acted as financial advisors to Furiex.
Details: Eluxadoline is a first-in-class, locally-acting mu opioid receptor agonist and delta opioid receptor antagonist for treating symptoms of diarrhea-predominant irritable bowel syndrome (IBS-D), a condition that affects approximately 28 million patients in the United States and Europe. In February 2014, Furiex announced top-line results indicating the company\'s two pivotal Phase III clinical trials evaluating the efficacy and safety of eluxadoline in the treatment of IBS-D met both the FDA and the European Medicines Agency formally agreed-upon primary endpoints of composite response based on simultaneous improvements in stool consistency and abdominal pain. Actavis expects to be in a position to announce an acceptance for filing of the New Drug Application for eluxadoline by the end of the third quarter of 2014.
Related: Gastroenterology Digestive diseases
