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GEN News Highlights : Sep 4, 2012

Valeant Buying Dermatology Firm Medicis

Valeant Pharmaceuticals has agreed to buy Medicis Pharmaceutical for some $2.6 billion in cash. The $44-per-share deal represents a 39% premium to the latter’s closing share price on the last trading day before the announcement has been made, and a 31% premium on the firm’s three month average trading price.

Medicis is a specialty pharmaceutical company focused primarily on the treatment of dermatological and aesthetic conditions. The firm reported net revenues of $7.2 million in calendar year 2011. Lead prescription brands include Solodyn™, Restylane®, Perlane®, Ziana®, Dysport®, and Zyclara®. Valeant says once the transaction is completed it intends to site commercial dermatology operations at Medicis’ headquarters in Scottsdale (AZ), operating as the Valeant division Medicis. Dermatology R&D operations will be carried out at sites in Laval (QC), Scottsdale, and Petaluma (CA).

“The acquisition of Medicis represents a significant next step in our journey to become the leader in dermatology by strengthening Valeant’s presence in acne, actinic keratosis, aesthetic injectables, and antivirals, among others,” remarks J. Michael Pearson, Valeant’s chairman and CEO. “Medicis’ highly complementary portfolio of leading branded products and promising pipeline is a solid strategic fit, and we look forward to leveraging Medicis’ well known and respected name in dermatology to drive long-term growth.”

Terms of the acquisition have been agreed to by both boards, and are subject to customary closing conditions including the approval of Medicis shareholders. Valeant says combining Medicis with its existing dermatology operations is expected to yield cost synergies of at least $225 per year within six months of closing.