Date: 2015-03-09
Type of information: Plant acquisition
Acquired company: Alkermes\' manufacturing facility in Gainesville (USA - GA) and global rights to meloxicam
Acquiring company: Recro Pharma (USA - PA)
Amount: up to $ 120 million
Terms: * On March 9, 2015, Alkermes announced that it has entered into a definitive agreement to sell its manufacturing facility in Gainesville, GA , the manufacturing and royalty revenue associated with products manufactured at the facility and global rights to Meloxicam IV/IM to Recro Pharma, a specialty pharmaceutical company. Under the terms of the agreement, Alkermes will receive from Recro an initial cash payment of $50 million , development and commercialization milestone payments of up to $120 million related to Meloxicam IV/IM, a proprietary, Phase III-ready, long-acting COX-2 NSAID for moderate to severe acute pain, and low double-digit royalties on net sales of Meloxicam IV/IM. This transaction is subject to antitrust law clearance as well as other customary terms and conditions. This transaction is anticipated to close in the second quarter of 2015. Assets being sold as part of the transaction include the Good Manufacturing Practices (GMP) facility in Gainesville , which was acquired by Alkermes in 2011 as part of its business combination with Elan Drug Technologies; Alkermes\' rights to RITALIN LA®, FOCALIN XR®, VERELAN® , ZOHYDRO® ER, and BIDILTM; and the late-stage, parenteral formulation of Meloxicam IV/IM, a nonsteroidal anti-inflammatory drug, which has completed multiple phase 2 trials for the management of moderate-to-severe acute pain, as well as related technology. As a result of this transaction, Alkermes is revising its financial expectations for 2015. At closing, Recro Pharma will issue Alkermes a seven-year warrant to purchase an aggregate of 350,000 shares of Recro Pharma common stock. The $50 million up-front payment will be funded via a five-year senior secured term loan with an affiliate of OrbiMed (“OrbiMed”). The acquisition is subject to customary closing conditions, including antitrust regulatory approval, and is anticipated to close in the second quarter of 2015.
Details: The transaction diversifies Recro Pharma development risk with second, complementary acute pain product, IV/IM meloxicam. This compound was designed using NanoCrystal® platform, a technology that enables enhanced bioavailability of poorly water-soluble drug compounds. In five Phase II studies in over 700 patients with acute pain, IV or IM meloxicam has demonstrated favorable analgesic properties, including rapid onset of pain relief and time to peak analgesic effect, 18 to 24 hour duration of pain relief and good tolerability. Positive Phase II post op hysterectomy and dental pain studies demonstrated large effect sizes.
Dex-IN, Recro Pharma’s intranasal formulation of dexmedetomidine, has upcoming interim analysis of ongoing Post Op Day 1 Phase II trial; and depending on Dex-IN clinical success, two proprietary compounds will be ready to enter Phase III by year end.
Gainesville manufacturing unit is a 85,000 sq. ft., ~165 employee, DEA-licensed facility l which manufactures five commercial products.
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