Week of October 24, 2016 | Vol. 5, Issue 42
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Depomed and activist investor Starboard Value have put aside their differences. The pair has reached a settlement, putting an end to a months-long proxy fight. But what's next for the California drugmaker?
Under the
agreement, Depomed's board will add three Starboard nominees--James Fogarty, former COO of Lehman Brothers Holdings; Robert Savage, former worldwide chairman for Johnson & Johnson's pharma group; and James Tyree, former EVP of pharma products at Abbott Laboratories--to its board.
Depomed has also amended some of the company bylaws Starboard deemed unfriendly to shareholders, shifting the window for investors to nominate directors.
The settlement comes amid talk of a potential Depomed sale and soon after a patent decision in the company's favor on its biggest drug, Nucynta. A deal might be less likely, analysts figure, though other moves--including Nucynta's relaunch--are probably in the cards.
Starboard has agreed to withdraw its proxy solicitation, which will pull the plug on a special shareholder meeting scheduled for next month. It also won't make any more nominations until the agreed-up period officially begins.
"We are pleased to have reached this agreement with Starboard, which we believe is in the best interests of our shareholders," Depomed CEO Jim Schoeneck said in a statement. "We are confident that we are aligned to deliver significant value to our shareholders."
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Ascendis nets $112M for PhIII growth hormone trial
Ascendis Pharma
is aiming to raise at least $112 million (€102 million) to move its long-acting growth hormone through a late-phase trial. The offering is intended to give Ascendis the means to carry out a Phase III growth hormone deficiency study while advancing other candidates that have yet to enter the clinic.
Copenhagen, Denmark-based Ascendis
is offloading more than 6 million shares for $19 a pop. That would see Ascendis net $112 million, after costs, although the total could increase if the underwriters take up an option on additional shares. Either way, Ascendis is set to add a considerable sum of money to its cash pile. Ascendis closed out June with €91 million in the bank.
The money will go toward a Phase III trial of TransCon Growth Hormone. Ascendis is set to enroll the first patient in the study by the end of the year. Over the duration of the 52-week trial, Ascendis is looking to show that its once-weekly growth hormone formulation can hold its own against Pfizer's Genotropin. If its drug triggers comparable improvements in annualized height velocity, Ascendis thinks the compliance benefits of the once-weekly regimen will enable it to take market share.
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Below are summaries and charts with the past week's transactions from the different healthcare sectors. For a detailed table showing data for each industry transaction click on any of the charts or use the download link above. Total transaction values are provided in USD millions.
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Pharma & Biotech
7 transactions totaling $13
million
Supplies, Equipment & Services
11 transactions totaling $17 million
Healthcare IT & Managed Care
3 transactions totaling $- million
Healthcare Facilities & Distributors
14 transactions totaling $610 million
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Pharma & Biotech
13 private placements totaling $250 million
Supplies, Equipment & Services
11 private placements totaling $140 million
Healthcare IT & Managed Care
5 private placements totaling $10 million
Healthcare Facilities & Distributors
1 private placement totaling $-
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Pharma & Biotech
9 public offerings totaling $550 million
Supplies, Equipment & Services
0 public offerings
Healthcare IT & Managed Care
1 public offering totaling $92 million
Healthcare Facilities & Distributors
0 public offerings
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 Each week, w
e provide updated trading
comps for leading comp
anies from numerous healthcare subsectors.
To the right you will see a high-level breakdown of median revenue and EBITDA multiples for each of the specific subsectors
For a complete trading comp analysis (including the individual equities that comprise the subsectors), click on the table to the right or use the download link from the top of this newsletter.
Note: data reflects prior week close.
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RECENT INDUSTRY HEADLINES
A Sampling of Relevant Industry Headlines from the Last Week
Below are snippets from relevant industry news articles from the past week presented in chronological order. For additional information or the article's complete text, click the headline link to view the original publication.
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October 17, 2016 - Outsourcing Pharma
Premier Research has become the most recent contract research organization (CRO) to receive funding from private equity as the industry looks for "like-minded" partners for the long run. "We are taking a different approach to clinical development services by focusing almost exclusively on biotech and specialty pharma," Ludo Reynders PhD, Premier Research CEO, told Outsourcing-Pharma.com. "Metalmark's investment in Premier will help us to further develop our high-touch customer service approach, hire more leading experts in oncology, neuroscience and rare disease fields, and continue our investment in technologies that enable our customers to rapidly meet their next investment or regulatory milestone."
October 17, 2016 - Wall Street Journal
Valeant Pharmaceuticals International Inc. on Friday said it was raising the prices of its stomach, neurology and urology drugs from 2% to 9%, effective immediately. The company also said it wouldn't increase the prices of its eye and skin drugs at all this year. Yet Wells Fargo Securities said Valeant raised the price of three eye drugs in September, each by 9.9%. The Canadian company's practice of buying drugs and raising the prices of drugs like heart treatments Nitropress and Isuprel by sizable percentages has drawn scrutiny from doctors, hospitals and members of Congress.
October 18, 2016 - Fierce Biotech
En route to Abbott's acquisition of St. Jude Medical, the duo is agreeing to sell off portions of their vascular and electrophysiology units, worth about $1.12 billion, to Terumo. The transaction is subject to the completion of the Abbott-St. Jude deal. The all-cash divestiture will see St. Jude offloading its Angio-Seal and Femoseal vascular closure products and Abbott cutting loose its Vado Steerable Sheath, according to a statement. Meanwhile, Abbott will get to hold on to its stable of vascular closure devices, such as the Perclose ProGlide Suture-Mediated Closure System and the StarClose SE Vascular Closure System. The transaction is under review by antitrust authorities.
October 18, 2016 -
Wall Street Journal
Pfizer Inc. said Monday it will begin selling a biosimilar version of blockbuster rheumatoid-arthritis treatment Remicade in late November at a 15% discount off the brand-name drug's list price. The announcement is likely to set up a fierce battle, in the courts as well as in contract talks with health insurers, between two of the biggest drug companies in the world by sales. Pfizer is launching its version, called Inflectra, before the resolution of an ongoing patent dispute with Remicade's maker Johnson & Johnson.
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As an international, healthcare-focused merchant bank and financial advisory firm, we provide world-class services and capital to middle-market healthcare companies around the globe. We aim to keep our clients well-informed of healthcare news and events. With this additional insight in mind, together, we can recognize trends and opportunities that benefit our clients. We hope that you will reach out to Bourne Partners to help execute your healthcare operational and transactional needs. To learn more about our firm, visit our website or utilize the links below to engage with us on social media.
Sincerely,
The Bourne Partners Team
Bourne Partners
550 South Caldwell Street
Suite 900
Charlotte, NC 28202
704-552-8407
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