Ipsen buys Merrimack’s oncology assets
January 9, 2017Ipsen has acquired global oncology assets from Merrimack Pharmaceuticals. This acquisition includes Merrimack’s key marketed product Onivyde (irinotecan liposome injection) for the treatment of patients with metastatic adenocarcinoma of the pancreas after disease progression following gemcitabine-based therapy, in combination with fluorouracil and leucovorin.
Ipsen has agreed to pay $575 million cash at closing plus up to $450 million upon the approval of potential additional indications for Onivyde in the U.S. The transaction will be fully financed by Ipsen’s existing cash and lines of credit, said the company. The deal should be dilutive in 2017 and accretive from 2018 onwards both in operating margin and EPS.
Under the terms of the agreement, Ipsen will gain exclusive commercialization rights for the current and potential future Onivyde indications in the U.S., as well as the current licensing agreements with Shire for commercialization rights ex-U.S. and PharmaEngine for Taiwan. The transaction also includes Merrimack’s commercial and manufacturing infrastructure, and generic doxorubicin HCl liposome injection, said the company in its press release issued on Monday.
The transaction represents a unique opportunity and a strong strategic fit for Ipsen. Onivyde is a clinically differentiated and FDA-approved product for patients with high unmet medical needs. The transaction secures a marketed, wholly-owned asset with current U.S. revenues and significant revenue growth projections, based on solid clinical data and potential approvals in additional indications already in clinical development. Furthermore, there are significant commercial synergies to be realized by integrating the Onivyde franchise with the existing Ipsen U.S. oncology commercial infrastructure, which has strong expertise and a proven track record with Somatuline. As a result, this transaction strengthens Ipsen’s Oncology franchise and accelerates both its near- and long-term growth trajectory and profitability.
David Meek, CEO of Ipsen, commented, “The acquisition of Onivyde represents a compelling strategic opportunity to further strengthen Ipsen’s oncology portfolio while leveraging our U.S. infrastructure and creating meaningful potential incremental growth and profitability. Pancreatic cancer is now the third leading cause of cancer-related deaths. It is an area that has had many drug failures and very few FDA approvals over the past two decades. For the tens of thousands of patients living with pancreatic cancer in the U.S. who have received prior treatment with gemcitabine, Onivyde represents an important, differentiated innovation, given its proven overall survival benefit in an area of high unmet medical need with few approved therapies.”
Under the terms of the agreement, Ipsen will be responsible for advancing the ongoing Onivyde clinical development program, which includes a Phase 2 trial in first-line previously untreated metastatic pancreatic cancer, a Phase 2/3 trial in relapsed small-cell lung cancer, and a Phase 1 pilot trial in breast cancer.
The transaction, which is subject to customary closing conditions, including governmental regulatory clearances, and a vote by Merrimack shareholders, is expected to close by the end of the first quarter of 2017.
