Shire to Acquire Dyax for $5.9 Billion
In a move to strengthen its rare-disease product portfolio, Shire has agreed to acquire Dyax Corp., a biopharmaceutical company developing plasma kallikrein (pKal) inhibitors for treating hereditary angioedema (HAE), for $37.30 in cash per Dyax share, for aggregate upfront consideration of approximately $5.9 billion. Dyax shareholders may receive additional value through a non-tradable contingent value right (CVR) that will pay $4.00 in cash per Dyax share upon approval of Dyaz’s DX-2930 in HAE, representing a potential additional $646 million in aggregate contingent consideration.
DX-2930 is a Phase III-ready, fully humanized monoclonal antibody targeting pKal and is Dyax’s most advanced clinical program. DX-2930 has received fast track, breakthrough therapy, and orphan drug designations by the FDA and has also received orphan drug status in the European Union. It is expected to enter Phase II clinical trials by year-end 2015. If approved for the prevention of Type 1 and Type 2 HAE, DX-2930 could generate estimated annual global sales of up to $2.0 billion, according to estimates from Shire. Dyax also has a commercial drug, Kalbitor, which is approved for HAE acute treatment in patients 12 years of age and older and whichrepresented an early innovation in HAE treatment.
The deal would add to Shire’s HAE portfolio, which includes Firazyr and Cinyrze. It also continues a series a recent acquisitions by Shire.Earlier this year, it acquired NPS Pharma for $5.2 billion. It also acquired Meritage Pharma, a privately held company, for an upfront fee of $70 million and additional contingent payments based on the achievement of development and regulatory milestones. With the acquisition, Shire acquired the global rights toâ€”and undertaken the further development ofâ€”Meritage's Phase III-ready compound, oral budesonide suspension (OBS), a drug for treating adolescents eosinophilic esophagitis (EoE), a rare, chronic inflammatory gastrointestinal (GI) disease. Shire obtained the rights to acquire Meritage in connection with its $4.2 billion acquisition in 2014 of ViroPharma, a company specializing in developing drugs for rare diseases. Also, earlier this year, Shire acquired Foresight Biotherapeutics Inc. for $300 million to add to its eye-care business. With the acquisition, Shire acquired the global rights to FST-100 (topical ophthalmic drops combining 0.6% povidone iodine (PVP-I) and 0.1% dexamethasone), a therapy in late-stage development for treating infectious conjunctivitis, an ocular surface condition commonly referred to as pink eye.
With its announced acquisition of Dyax, Shire also reiterated its interest in acquiring Baxalta, the biopharmaceutical company spun off from Baxter earlier this year. In August 2015, Shire made an approximate $30 billion proposal to acquire Baxalta, a move that Baxalta has thus far rejected. Shire’s move to acquire Baxalta came after AbbVie terminated a proposed acquisition of Shire for approximately $55 billion in October 2014. “I am also confident that our M&A expertise and the ongoing strength of our business will enable rapid and effective integration following the closing, as demonstrated by the success of our NPS and ViroPharma acquisitions. Even with this transaction, we will continue to have the financial firepower to pursue other value-added strategic acquisitions, including Baxalta,” said Shire Chief Executive Officer Flemming Ornskov, in a company statement.
Shire anticipates that it will realize operating synergies of $50 million starting in 2017 and growing to at least $100 million in 2019. Shire, which is headquartered in Dublin, Ireland, says that the transaction constitutes a Class 2 transaction for the purposes of the UK listing rules and, as such, Shire shareholder approval is not required. The transaction has been unanimously approved by the boards of directors of both Shire and Dyax and is expected to close in the first half of 2016. The transaction is subject to approval by Dyax shareholders and customary closing conditions and regulatory approvals.
For further insight into Shire’s strategy and the specialty pharmaceutical market, see related story, “M&A Heats Up Specialty Pharma Market.”