Monday, May 27, 2013

AstraZeneca to acquire fish oil company Omthera Pharma for $260million in cash and $120m in form of CVR's

AstraZeneca has announced that it will acquire Omthera pharma for $12.7 per share. Accounting for the cash balances ($63m) with Omthera, the enterprise value at the acquisition price comes to $260million. The deal represents a 88% premium to Omthera's closing price on Friday 24th May.  In addition to the cash payment Omthera shareholders are also entitled to contingent value rights (CVRs) of  $4.7 per share equating to approxmaely $120m in total, if specified milestones related to fish oil drug Epanova are met. This will bring the total potential acquisition cost to approximately $380million

Omthera lead drug candidate Epanova is a fish oil product currently in Phase 3 trials. The drug is intended for the treatment of Hypertriglyceridemia. GSK is already marketing a similar product under the brand name Lovaza, which generated $1.2billion in peak sales. Amarin's Vascepa is also a potential competitior for Epanova.

Omthera is expected to file a new drug application (NDA) in the US for Epanova in mid-2013 for patients with severe hypertriglyceridemia (triglyceride levels greater than or equal to 500mg/dL), with regulatory filings in other markets to follow. AstraZeneca aims to file a supplemental NDA as soon as possible for Epanova as a treatment for patients with mixed dyslipidemia (triglyceride levels of 200-499mg/dl), as well as in a fixed dose combination with CRESTORÒ (rosuvastatin calcium) for those mixed dyslipidemia patients at high risk of a cardiovascular event. AstraZeneca intends to pursue a large-scale cardiovascular outcomes trial for Epanova in combination with statins.