Irish investment fund set to benefit from Bayer's $875m UK acquisition

Bayer's headquarters in Leverkusen, Germany

Irish investment firm Fountain Healthcare Partners stands to benefit from German pharmaceutical giant Bayer’s proposed mega takeover of UK biotech company KaNDy Therapeutics.

Fountain – which manages Ireland’s largest life science venture capital fund – was an early-stage investor in KaNDy, which is developing a treatment to improve menopausal symptoms, and still holds a stake in the company.

Bayer has struck an $875m (€745m) deal to acquire the British women’s health biotech, bolstering its pharmaceuticals division before patents expire on some key products.

The German drug and chemical company has agreed to pay $425m upfront and potential milestone payments of $450m until the launch of KaNDy’s experimental treatment for menopause symptoms. The deal is expected to close in September.

KaNDy’s drug - NT-814 - is expected to start a final-stage clinical trial next year and could generate peak sales of €1bn globally.

Once KaNDy’s drug comes to market, Bayer could make additional sales milestone payments that exceed $100m, the company said.

With blockbuster blood thinner Xarelto and eye-care medicine Eylea losing patent protection in the next few years, Bayer’s pharmaceutical division has been looking for small-scale deals to boost earnings.

While the KaNDy deal is a “good start,” Bayer will need more such moves to make up for the coming loss in revenue from Xarelto and Eylea, which combined for €6.6bn in sales last year, Bloomberg analyst Michael Shah said.

“As a global leader in women's healthcare, Bayer is an ideal partner for KaNDy Therapeutics to continue the progress and optimise NT-814 as a potential treatment option," said Fountain Healthcare partner Ena Prosser.