BackSun Pharma to acquire US firm Concert for $576 mn
Sun Pharmaceutical agreed to buy Concert for $576 million to access the US firm’s experimental drugs for treating skin diseases, including patchy hair loss
PremiumSun Pharmaceutical Industries Ltd on Thursday agreed to buy Concert Pharmaceuticals Inc. for $576 million to access the US company’s experimental drugs for treating skin diseases, including patchy hair loss.
Concert Pharmaceuticals has an extensive patent portfolio, including its lead product candidate, deuruxolitinib, a late-stage drug for treating alopecia areata, an autoimmune dermatological disease resulting in patchy hair loss.
The deal will help strengthen Sun Pharma’s dermatology product range in the US. The company said its immediate focus is on submitting a New Drug Application to the US Food and Drug Administration (FDA) in the first half of 2023.
“Sun Pharma is building a global dermatology and ophthalmology franchise and aims to be a preferred development and commercial partner in these therapies worldwide. The acquisition of Concert adds a late-stage, potential best-in-class treatment for alopecia areata in deuruxolitinib," said Abhay Gandhi, chief executive of North America at Sun Pharma.
Sun Pharma will acquire all outstanding shares of Concert through a tender offer for an upfront payment of $8 per share of common stock in cash or $576 million in equity value.
Concert stockholders will also receive a non-tradeable contingent value right entitling holders to receive up to an additional $3.50 per share of common stock in cash, payable upon the alopecia drug achieving certain net sales milestones within specified periods.
The transaction was approved by the boards of both companies.
“We are pleased to enter into this exciting transaction with Sun Pharma, which delivers substantial value to our shareholders and is the outcome of a thorough review process overseen by the Concert board," said Roger Tung, president and chief executive officer of Concert Pharmaceuticals.
The transaction is expected to be completed in the first quarter of 2023.
For the nine-month ended 30 September, Concert Pharmaceuticals reported revenue of $29,000 and a loss of $90.6 million.
The research and development expense for that nine-month period was $75.7 million.
As of 30 September, Concert Pharmaceuticals had $148.9 million in cash, cash equivalents and investments.
Sun Pharma had net cash of $1.6 billion as of 30 September.
“I look forward to welcoming the exceptionally talented Concert team who have worked tirelessly to develop the product to bring it to market," said Sun Pharma’s Gandhi.
“There is a significant unmet need in the alopecia areata space, and we aim to build on Concert’s commitment to supporting the Alopecia Areata patient community. We are well-positioned to successfully bring this product to market globally," Gandhi added.
Moelis and Co. LLC served as the financial adviser to Sun Pharma, and Davis Polk and Wardwell LLP as the legal adviser.
MTS Health Partners L.P. and Chestnut Partners, Inc. served as financial advisers to Concert Pharmaceuticals and Goodwin Procter LLP as legal adviser.
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