Week of November 7, 2016 | Vol. 5, Issue 44
In This Issue
Featured Headlines
Recent Industry Transactions
Industry Trading Comps
Recent Industry Headlines

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Complete Transaction Tables
Full Trading Comp Analysis

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Jeremy C. Johnson
Managing Director
Pharma & Consumer Health
jjohnson@bourne-partners.com

Xan Smith
Managing Director
Business Development
xsmith@bourne-partners.com
INDUSTRY M&A SNAPSHOT

Above is an overview of recent industry M&A activity. For additional information, see the charts below or follow the link to the left to download complete transaction tables broken out by industry subsectors.

See below for additional information about industry trading comps and transaction relevant articles from the past week.

A potential $10 billion deal shows how Japan's largest drugmaker by sales, Takeda Pharmaceutical  Co. , is placing its bets on the U.S. and Europe for growth under its French chief executive,  Christophe Weber.

Takeda said Wednesday that it was on the hunt for global acquisitions after The Wall Street Journal reported that it was in  advanced talks to acquire a stomach-drug businessfrom  Valeant Pharmaceuticals International  Inc.  Takeda declined to comment specifically on any potential deal with Valeant but said it was "aiming to accelerate its growth" and was "in discussion with many parties" about deals for drugs treating stomach diseases, cancer and other areas.
People familiar with the matter said Takeda could reach a deal with Valeant for Salix Pharmaceuticals Ltd., which Valeant  bought a year and a half ago. The deal size could be about $10 billion, including $8.5 billion in cash and future royalty payments to Valeant, they said.  If completed, the deal would build on Takeda's past success with heartburn drugs and underscore that the Osaka-based company sees the U.S. as its core growth market. Takeda has staked its future on growth overseas after making two big purchases-Millennium Pharmaceuticals Inc. in 2008 and Nycomed A/S of Switzerland in 2011 for a combined total of about $23 billion.


Continue Reading at Wall Street Journal
Top generics players and execs face DOJ investigation, charges: Bloomberg
Share prices for leading generics companies took a big hit Thursday on news that the Department of Justice could file collusion charges by year's end, a probe first  unveiled  by Bloomberg .

Companies including Mylan, Teva, Lannett, Impax and Endo International face charges of price fixing, according to the report by David McLaughlin and Caroline Chen, following a DOJ investigation that's lasted about two years. The probe ranges over two dozen drugs and "about a dozen companies," Bloomberg 's Drew Armstrong tweeted on Thursday.  Charges may not be limited to the corporations themselves but could apply to individual executives as well. The Justice Department has recently moved to prosecute drug company management in kickbacks cases, part of a broader move to  hold executives accountable  for their companies' actions.  The investigation "could add a severe overhang to the sector that may last well past the presidential election and into the new year," Wells Fargo analyst David Maris wrote in a Thursday note. He said that even though fines "could be significant," what's more concerning for the industry is how the development might "bring calls for controls and oversight."  The news comes as U.S. officials work to tackle the popular election-year topic of drug pricing, following now-notorious price hikes by Turing Pharmaceuticals and Valeant Pharmaceuticals more than a year ago. Sen. Bernie Sanders and Rep. Elijah Cummings have been conducting their own investigations into generic drug pricing as well and have  proposed mechanisms  to limit price hikes. 


C ontinue Reading at  Fierce Pharma.

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.



 Pharma & Biotech
 16 transactions totaling $508  million
 Supplies, Equipment & Services
 12 transactions totaling $5,827 million
 Healthcare IT & Managed Care
 1 transactions totaling $- million
 Healthcare Facilities & Distributors
 12 transactions totaling $2,097 million





Pharma & Biotech
12 private placements totaling $352 million
Supplies, Equipment & Services
13 private placements totaling $81 million
Healthcare IT & Managed Care
5 private placements totaling $19 million
Healthcare Facilities & Distributors
3 private placement totaling $30 million


 Pharma & Biotech
 6 public offerings totaling $5,085 million
 Supplies, Equipment & Services
 2 public offerings totaling $18 million
 Healthcare IT & Managed Care
 0 public offerings
 Healthcare Facilities & Distributors
 0 public offerings

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.
RECENT INDUSTRY HEADLINESRecentIndustryHeadlines
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.
Valeant Exploring Sale of Eye-Surgery Equipment Business
November 2, 2016 - Wall Street Journal
The eye-surgery business, which Valeant acquired with its purchase of Bausch & Lomb just three years ago, could fetch as much as $2.5 billion in a sale, according to people familiar with the matter. It's not clear who may be interested in the operation. The sales process is in an early stage and Valeant may still decide not to sell the business, some of the people said.  The Wall Street Journal reported yesterday that Valeant is in  advanced talks to sell its Salix Pharmaceuticals Ltd. stomach-drug business  to Japan's  Takeda Pharmaceutical  Co. for $10 billion, including $8.5 billion in cash and the rest in royalties. Valeant acquired Salix just a year and a half ago, and the fact that it's selling it so soon shows the depths of the challenges the Canadian company faces amid questions about its accounting and business practices and whether the company has too much debt.

November 3, 2016 - Fierce Biotech
Allergan took an R&D hit this quarter as it emerged from analysts that a Phase II test of dermatology med VTP-38543, acquired as part of a $640 million buyout deal of Vitae in September, has failed.  The med, a topical LXRβ (liver X receptor beta) selective agonist aimed at treating atopic dermatitis, "failed to show a positive signal in proof of concept," according to analysts from  Leerink  and Evercore ISI.
 
November 2, 2016 - Fierce Pharma
Sanofi's vaccines continue to be a spot of sunshine in the French drugmaker's overall cloudy picture. In the third quarter, Sanofi Pasteur grew sales 14% over last year,  besting all other units but the company's rare-disease group, Genzyme.  To notch the sales win, Sanofi Pasteur can thank early flu shipments to the U.S., execs said on a call with analysts, a tactic that rival GlaxoSmithKline cited in its own results for the period. Sanofi's influenza vaccines were up 35% on the quarter to €989 million ($1.1 billion).  And that was a good thing for Sanofi, because uptake for Dengvaxia, its first-of-a-kind dengue fever vaccine, "remains behind our initial expectations," CEO Olivier Brandicourt said. The new vaccine--a result of 20 years and $1.5 billion in R&D efforts--booked €30 million on the quarter to bring its total for the year to €50 million. Execs had initially guided €200 million for the year.

Pfizer's Prevnar 13 dips in Q3; vaccines hold steady but fail to match peers' growth
November 1, 2016 - Fierce Pharma
In third-quarter results  released Tuesday, Pfizer reported Prevnar sales down year-over-year by 3% to $1.54 billion. That's on top of a 16% decline for the vaccine in Q2. But the vaccine was able to outperform consensus estimates of $1.48 billion in the most recent quarter.  It's a big turnabout for a product that had been roaring ahead. Last year, Prevnar 13 notched consecutive sales increases to drive Pfizer's vaccines business up by 44% for 2015.  Prevnar's blockbuster sales are still a major contributor to Pfizer's vaccines unit--and the company overall. But for the third quarter, it was Pfizer's other vaccines that powered the unit's growth, paltry as it was. Those products grew to $172 million on the quarter, from last year's $60 million. Overall, Pfizer's vaccines sales went up by 1%.

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
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