ANI Pharmaceuticals nets two corticotropin products from Merck & Co.

ANI will pay $75M in cash for the NDAs of the two products

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BAUDETTE, Minn.—ANI Pharmaceuticals Inc. is acquiring the New Drug Applications (NDAs) for purified corticotropin gel and corticotropin zinc hydroxide from Merck & Co. (known as MSD outside of the United States and Canada) for $75 million in cash and a percentage of future net sales. The acquisition is being funded through cash on hand and is subject to customary closing conditions. ANI expects the deal to close in January 2016.
The transaction includes corticotropin, 40 units/mL and 80 units/mL, NDA #008975, and corticotropin-zinc hydroxide, 40 units/mL, NDA #009854. Corticotropin gel is a purified corticotropin (ACTH) in a sterile solution of gelatin for prolonged activity, and corticotropin-zinc hydroxide (sterile corticotropin zinc hydroxide suspension USP) is a sterile aqueous suspension of purified corticotropin (ACTH) with zinc hydroxide for repository action. The pair of products is approved for several indications, including multiple sclerosis, rheumatic disorders, dermatologic diseases and a number of collagen, ophthalmic and respiratory diseases in addition to allergic and edematous states. According to an investor presentation, the two corticotropin products could also offer footholds in endocrine disorders, hematologic disorders, neoplastic diseases, gastrointestinal disease and nervous system conditions, among others. ANI estimates that the U.S. market for these products is in the range of $1 billion.
“This represents a transformational opportunity for ANI that remains consistent with our strategy of acquiring and re-commercializing previously approved products. We have added a unique and substantial opportunity to our expanding product pipeline and by establishing a new foreign platform we feel that ANI has set the stage for long term growth both organically and through future acquisitions,” Robert W. Schrepfer, vice president of business development for ANI Pharmaceuticals, commented in a statement.

In conjunction with this deal, ANI is planning to pursue the formation of one or more foreign subsidiaries to handle its acquisitions, manufacture products and/or provide other services. This acquisition is expected to be effected through such a subsidiary, and the move is likely to let ANI achieve a lower overall tax rate for its operations.

“This acquisition is intended to enable us to compete in a one-billion-dollar branded market alongside H.P. Acthar gel,” Arthur S. Przybyl, president and CEO of ANI Pharmaceuticals, remarked in a press release. “We are confident in our ability to re-commercialize these products.”

H.P. Acthar gel is marketed by Mallinckrodt Pharmaceuticals, and is indicated for the same disease states as the two products ANI is acquiring (with the exceptions of allergic states and dermatologic diseases), as well as infantile spasms.

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