Oh la la! Ipsen goes wild

French pharma expands global footprint with three U.S. deals totaling $450M

Amy Swinderman
PARIS—Seeking to expand its global footprint, French pharma Ipsen Inc. went on a $450 million shopping spree last month for three American companies—Tercica Inc. of Brisbane, Calif., the U.S. operations of British biotech company Vernalis Ltd. and biopharmaceutical company Octagen, a hemophilia specialist in Wilmington, Del.

Ipsen CEO Jean Luc Belingard says the transactions will further the globalization of Ipsen's growing specialist care franchise by adding the fields of endocrinology, neuromuscular disorders and hematology to its portfolio.

The deals could generate $300 million in sales for Ipsen by 2012 and close to $1 billion by the end of the next decade, Belingard says.

"With a fully fledged commercial infrastructure in North America, Ipsen will further enhance its growth profile, be able to seize the opportunities to expand in the world's largest pharmaceutical market and leverage its existing rich research and development pipeline," he says.

In the field of endocrinology, Ipsen will acquire the 44.9 million Tercica shares it does not currently own for $9 per share in cash, for a total of $404 million.

In the field of neuromuscular disorders, Ipsen will acquire Vernalis' U.S. operations for up to $12.5 million. The transaction gives Ipsen the rights to market Apokyn, a treatment for "off" episodes in moderate to severe Parkinson's Disease, and an opportunity to market Dysport, a drug used for a variety of conditions ranging from frown lines to excessive armpit sweating, to Vernalis customers. In addition, Ipsen will subscribe to $5 million newly-issued Vernalis shares, and the two companies will form a joint venture to seek funding for some of Ipsen's neurology pipeline projects. If this does not proceed, Ipsen will pay Vernalis an additional $1 million.

Finally, in the field of hematology, Ipsen will acquire all of Octagen's assets related to OBI-1, Octagen's investigational hemophilia drug, in an upfront payment of $10.5 million. Ipsen, which collaborated with Octagen on the development of OBI-1, will also pay Octagen milestone payments and royalties that could total $26 million. Immediately following the completion of the OBI-1 acquisition, Ipsen will also redeem its stake in Octagen.

Tercica Senior Director of Investor Relations and Corporate Development Fred Wiklund says the merger with Ipsen is a natural evolution of  a cross-licensing agreement the companies reached in 2006 in which Ipsen sold Tercica's Increlex and Tercica sold  Ipsen's Somatuline Autogel.

"We have a very good working relationship with Ipsen," Wiklund says. "This will give our shareholders more value and give Tercica more resources for our development projects."

Vernalis COO John Slater says Ipsen's acquisition affirms its high-profile presence in the neurology field.

"I am both proud and pleased that they can bring so much to Ipsen whilst embracing new and exciting challenges including the forthcoming launch of Dysport in the U.S.," Slater says.

Octagen declined to comment on its deal with Ipsen. DDN

Amy Swinderman

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