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Apr 5, 2011

Merck & Co. to Pick Up Inspire Pharmaceuticals for $430M

Merck & Co. to Pick Up Inspire Pharmaceuticals for $430M

Deal, which represents a 25.6% premium, expands ophthalmology portfolio and pipeline.[]

  • Merck & Co., known as MSD outside the U.S. and Canada, is acquiring Inspire Pharmaceuticals, a specialty pharmaceutical company focused on developing and commercializing ophthalmic products. The transaction has a total cash value of approximately $430 million.

    Under the terms of the agreement, Merck, through a subsidiary, will commence a tender offer for all outstanding common stock of Inspire at a price of $5.00 per share in cash, a 25.63% premium to Inspire's closing price on April 4. Warburg Pincus Private Equity IX, which owns approximately 28% of the outstanding shares of Inspire, has agreed to tender all of its shares into the offer.

    “Merck continues to build upon its long-term commitment to improving therapeutic options for the treatment of eye diseases,” says Beverly Lybrand, svp and GM, neuroscience and ophthalmology, Merck. “This acquisition combines the talented commercialization organization at Inspire with the excellent team already in place at Merck, thereby strengthening our ophthalmology business and positioning us for future growth with an expanded portfolio.”

    Merck’s lead eye disease candidate is tafluprost, a preservative-free prostaglandin analogue ophthalmic solution. In March Merck reported that the NDA had been accepted for review. Inspire markets two eye disease products: Azasite and Elestat. Azasite 1% is indicated for the treatment of bacterial conjunctivitis in patients one year and older caused by the following organisms: CDC coryneform group G*, Haemophilus influenzae, Staphylococcus aureus, Streptococcus mitis group, and Streptococcus pneumoniae. Elestat 0.05% is approved for the prevention of ocular itching associated with allergic conjunctivitis.

    Azasite is also in development as a treatment for blepharitis, a disease characterized by inflammation of the lid margin. It is currently in a Phase II program for this indication. Also in clinical trials is INS117548 and INS115644 for glaucoma. INS117548, a Rho kinase inhibitor, has completed a Phase I placebo-controlled, dose-escalating trial in 84 patients with early-stage glaucoma or ocular hypertension. INS115644, a Latrunculin B compound, has completed a Phase I placebo-controlled dose-ranging trial in 56 patients with early-stage glaucoma or ocular hypertension.

    Inspire reported total revenue for 2010 was $106.4 million, an increase of 15% compared to $92.2 million recognized in 2009. Azasite revenue was $42.7 million, an increase of 22% compared to $35.0 million recognized in 2009. Co-promotion revenue from Elestat was $16.9 million as compared to $18.8 million in 2009.

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