Vectura Snaps Up Activaero for $181M in Respiratory Pact
Vectura Group said today it acquired Activaero Group in a €130 million (approximately $181 million) deal that creates a combined company specializing in developing respiratory drugs, with a broader portfolio that includes a late-stage unpartnered drug and a technology that creates opportunities for new drug-device products and partnerships.
Vectura said it will pay Activaero €95 million ($132.5 million) upon completion of the deal—€45 million (about $63 million) cash and the rest in new Vectura shares the company expects will start trading on March 18—plus €35 million (about $49 million) cash payable on August 1, 2015 or the next business day.
Activaero focuses on developing respiratory disease drugs. Its lead asset, FAVOLIR®, gives Vectura an unpartnered late-stage product with potential for sales that according to Vectura exceeds the total deal price. Vectura expects to file for a marketing authorization in Europe by late 2017, and in the U.S. by 2020, following the successful completion of an additional clinical trial in Europe that will also support a U.S. filing. Once FAVOLIR is ready for commercialization, Vectura estimates it will only need to spend for “only a small, specialist sales force” to capture a global market it estimates at approximately $2 billion.
Another late-stage yet unpartnered Activaero drug candidate, SCIPE, is a treatment for pediatric asthma, with an estimated market of 1.1 million mild/moderate asthmatics under age 12.
The deal also extends Vectura’s product offerings by including Activaero’s nebulizer-based technology, which it calls smart since it is designed to allow drug deposition into targeted areas of the lung. The technology—Flow and Volume Regulated Inhalation Technology or FAVORITE—is now used in the company’s seven clinical and several preclinical stage programs. Vectura reasons that FAVORITE is well suited to patients with severely compromised respiratory function, especially children and elderly people.
Vectura said it also found the deal attractive because of Activaero’s three device families—AKITA® JET, APIXNEB, and FOX—covering both the desktop and portable inhaler segments. The devices provide patient benefits such as improved delivery efficiency, consistent and reproducible dosing and treatment tailored to each patient's breathing capacity, Vectura said.
“We are determined to build further value in our company and this transaction represents an important step towards building a sustainable specialty pharma business,” Vectura CEO Chris Blackwell, Ph.D., said in a statement. “The acquisition is highly complementary to Vectura's core capabilities, in-line with our strategic priorities and, I believe, will enable us to build a therapeutic specialist in airways diseases.”
Vectura said the deal produces near-term cost-cutting potential or “synergies” of approximately €1.5 million (about $2.1 million) resulting from reducing duplicate head office and administrative costs.