Pfizer to acquire NextWave Pharmaceuticals for as much as $680 million

Pfizer sets its sights on privately held, specialty pharmaceutical company focused on the development and commercialization of products to treat attention deficit/hyperactivity disorder and related central nervous system disorders

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NEW YORK—After entering into an option and mergeragreement with NextWave Pharmaceuticals Inc. in the second quarter of 2012 andat that time making an option payment of $20 million, Pfizer Inc. this weekdecided to exercise its option to acquire the Cupertino, Calif.-based company, whichis primarily focused on products for the treatment of attentiondeficit/hyperactivity disorder (ADHD) and related central nervous systemdisorders.
NextWave has already developed an approvedproduct, Quillivant XR (methylphenidate hydrochloride), the first once-dailyliquid medication approved in the United States for the treatment of ADHD—andholds exclusive North American commercialization rights to the extended-releaseoral suspension drug, which is expected to hit U.S. pharmacies in January 2013.The U.S. Food and Drug Administration granted approval to Quillivant XR in lateSeptember of this year.
Under the terms of the agreement, Pfizer will makea payment to of $255 million to NextWave's shareholders at the closing of thetransaction, and NextWave's shareholders are eligible to receive additionalpayments of as much as $425 million based on certain sales milestones. Added tothe $20 million already paid out for the option to acquire NextWave, that makesthe acquisition worth as much as $700 million in total.
The transaction is expected to close during thefourth quarter of this year, subject to regulatory approval in the United Statesand other customary closing conditions.
"This agreement demonstrates our focused expansionof the Established Products U.S. brands business to offer a diverse portfolioof high-quality medicines that meet patients' needs," said Albert Bourla,president and general manager of Pfizer's Established Products business unit."By combining the advantages of Quillivant XR with Pfizer's commercializationexpertise, we will be able to provide ADHD patients and their caregivers a newtreatment option."
"NextWave has been focused on helping patients andfamilies who struggle with the challenges of ADHD. We are excited to partnerwith Pfizer, one of the most respected pharmaceutical organizations in theworld, to bring the unique benefits of Quillivant XR to those affected by thischallenging condition," said Jay P. Shepard, president and CEO of NextWave.
ADHD is one of the most common neurobehavioraldisorders in the United States and, according to a U.S. Centers for DiseaseControl and Prevention report in 2009 report, nearly one in 10 children aged 4to 17 in the United States have at some time received a diagnosis of ADHD. Thecondition often lasts into adulthood, with adult ADHD said to affect approximately4 percent of Americans.
Quillivant XR was developed in collaboration with MonmouthJunction, N.J.-based Tris Pharma, NextWave's technology and manufacturingpartner, and the drug is built on Tris' OralXR+ platform.
And, if a once-daily oral suspension formulation ofan ADHD drug wasn't novel enough, NextWave is also in the process of developingan extended-release chewable tablet version of Quillivant XR. That variation ofthe product is in advanced stages of clinical evaluation and NextWave'sintention has been to submit the product for approval next year.

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