Jazz Pharmaceuticals finalizes EUSA Pharma acquisition

Transaction expected to be immediately accretive

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DUBLIN—Jazz Pharmaceuticals has announced the closing of itsacquisition of privately held EUSA Pharma, an acquisition that gains JazzPharmaceuticals the product Erwinaze (asparaginase Erwinia chrysanthemi), a treatment for patients suffering from acutelymphoblastic leukemia. In addition, Jazz Pharmaceuticals also adds to itsproduct listing a portfolio of oncology and critical care products formarketing outside of the United States thanks to EUSA Pharma's internationalsales and marketing experience.
The total price tag for the acquisition was $680 million incash, financed with cash on hand and proceeds from a six-year, $475 millionterm loan. The sum is based on a base transaction price of $650 million, withapproximately $30 million worth of adjustments for EUSA Pharma's workingcapital, cash and certain liabilities. In addition, the transaction includes apotential $50 million milestone payment if Erwinaze achieves a predeterminedU.S. net sales target in 2013. following the close of the acquisition, JazzPharmaceuticals' cash balance is more than $100 million.
"This transaction furthers our mission to improvepatients' lives by growing our portfolio of specialty therapies that addresssignificant medical needs. The addition of EUSA Pharma as our new internationalbusiness also expands our global footprint and brings additional marketedproducts and development opportunities to the company," Bruce Cozadd,chairman and CEO of Jazz Pharmaceuticals, said in a press release about thedeal. "We are also pleased to bring new talent to the company from EUSA Pharmato help us pursue our goals as a specialty biopharmaceutical company dedicatedto reaching patients who have very specific needs."
Jazz Pharmaceuticals first began the acquisition processwith its April 26 announcement of the signing of a definitive agreement withEUSA Pharma, under which it would acquire the specialty pharmaceutical company.The price was originally set at $650, "subject to working capital adjustments,"and the acquisition is expected to be immediately accretive to JazzPharmaceuticals' adjusted earnings per share upon its closing. In 2013, theacquisition is expected to provide additional revenue of $210 million to $230million, additional adjusted earnings before interest, taxes, depreciation andamortization of $75 million to $85 million and an additional $0.75 to $0.85 inadjusted earnings per share.
The company will issue updated financial guidance along withits upcoming release of its second quarter 2012 financial results. Theacquisition of EUSA Pharma is expected to result in expected incrementalrevenue of $90 million to $100 million and an estimated additional $0.25 to$0.30 in adjusted earnings per share.
EUSA Pharma currently has a portfolio of 10 oncology,critical-care and oncology supportive care products being marketed in theUnited States and Europe, with Erwinaze as its lead product. Now that theacquisition is closed, EUSA Pharma's business outside of the United States willretain its name and be responsible for marketing a product portfolio outside ofthe United States as well as managing the company's pan-European presence.Bryan Morton, founder and former president and CEO of EUSA Pharma, will leadthe business. The company has approximately 180 employees, with operations andoffices in Langhorne, Penn., Oxford, United Kingdom, and Lyon, France.
SOURCE: Jazz Pharmaceuticals

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