Date: 2015-11-06
Type of information: Company acquisition
Acquired company: ZS Pharma (USA - CA)
Acquiring company: AstraZeneca (UK)
Amount: $2.7 billion
Terms: * On November 6, 2015, AstraZeneca announced that it has entered into a definitive agreement to acquire ZS Pharma, a biopharmaceutical company based in San Mateo, California. The transaction will give AstraZeneca access to the potassium-binding compound ZS-9, a potential best-in-class treatment for hyperkalaemia, a condition associated with increased mortality in CKD and CHF. ZS-9 is under regulatory review by the FDA with a Prescription Drug User Fee Act goal date of 26 May 2016. A submission for European Marketing Application Authorisation is planned by the end of 2015. Current estimates for global peak year sales of ZS-9 exceed $1 billion.Under the terms of the agreement, AstraZeneca will acquire all of the outstanding capital stock of ZS Pharma for $90 per share in an all-cash transaction, or approximately $2.7 billion in aggregate transaction value. Upon completion, ZS Pharma, which has around 200 employees across three sites in California, Texas and Colorado, will become a wholly owned subsidiary of AstraZeneca. The transaction does not impact AstraZeneca’s financial guidance for 2015. It is expected to generate Product Sales from 2016, with minimal earnings dilution over 2016 and 2017, becoming accretive to AstraZeneca’s core earnings from 2018. The acquisition is structured as an all-cash tender offer for all outstanding shares of ZS Pharma common stock at a price of $90 per share, followed by a merger in which each remaining untendered share of ZS Pharma common stock would be converted into the same $90 cash per share consideration as in the tender offer. Under the terms of the merger agreement, AstraZeneca will commence a tender offer to acquire all outstanding shares of ZS Pharma’s common stock. The Board of Directors of ZS Pharma has unanimously approved the terms of the agreement.
Details: ZS Pharma uses its proprietary ion-trap technology to develop novel treatments for hyperkalaemia (high potassium levels), a serious condition of elevated potassium in the bloodstream, typically associated with chronic kidney disease (CKD) and chronic heart failure (CHF). ZS-9 is a proprietary zirconium silicate compound and is manufactured as odourless, tasteless crystals. It acts as a highly selective potassium trap, is administered orally in 5 to 15g doses mixed with three tablespoons of water, is not systemically absorbed and is excreted in faeces. Clinical studies indicate that ZS-9 is stable at room temperature and has a rapid onset of action. Current estimates for global peak year sales of ZS-9 exceed $1 billion. Pending and granted patents, some under license, have expiries out to 2032 and beyond. Last July, the New Drug Application (NDA) for ZS-9 (sodium zirconium cyclosilicate) for the treatment of hyperkalemia, has been accepted for filing by the FDA and the Prescription Drug User Fee Act (PDUFA) goal date for a decision by the FDA is May 26, 2016.
Related: Cardiovascular diseases Metabolic diseases
