Horizon will offer Hyperion holders $46 a share in cash, the companies said yesterday. That amounts to 7.6% above Friday’s closing level and about 35% above the average price for the past two months.
The deal will give Horizon two drugs to treat urea cycle disorders, inherited ailments that can cause a build-up of ammonia in the body. Horizon moved its corporate address from Deerfield Illinois to Dublin last year in order to lower its tax bill. It makes products to treat arthritis, inflammation and rare illnesses. Shares of Hyperion, based in Brisbane, California, have soared 78% this year, in part because of takeover speculation.
“The Hyperion acquisition will expand and diversify our product portfolio,” Timothy Walbert, Horizon’s chairman and chief executive, said in the statement.
Drugmakers have turned a hunt for fast-growing orphan and rare-disease medicines into a buying frenzy.
The purchase will add to what has already been the biggest start to the year for pharmaceutical and biotechnology takeovers since 2009, according to data compiled by Bloomberg.
Major acquisitions have included AbbVie’s $21bn bid for cancer treatment developer Pharmacyclics and Pfizer’s agreement to buy injectable-medicine maker Hospira for about $17bn.
Hyperion’s two products, Ravicti and Buphenyl, garnered combined sales of $113.6m last year, the companies said. Hyperion is preparing to start a late-stage clinical trial to test whether Ravicti can also treat hepatic encephalopathy, a neurological condition that affects patients with liver cirrhosis.
Bankers from Jefferies LLC, Citigroup Global Markets, and Cowen & Co advised Horizon, and Citigroup and Jefferies are initial lenders and lead arrangers for the debt commitments to finance the transaction. Centerview Partners LLC advised Hyperion and provided a fairness opinion, while Shearman & Sterling LLP acted as legal adviser. Houlihan Lokey Capital also provided financial advice to Hyperion’s board.
Horizon will begin a tender offer for Hyperion shares. Stockholders who own 21% of the company, including some Hyperion executives and board members, have agreed to tender their stock.
Last month, Horizon said it would create 60 jobs at the unveiling of its new global HQ in Dublin; with an emphasis being on R&D, supply chain and finance. The jobs will be filled over the next three years.
Mr Walbert said the city has a deep pool of talent from which to draw.
Bloomberg (additional reporting Irish Examiner)