Piramal to buy drug portfolio from Mallinckrodthttps://indianexpress.com/article/business/companies/piramal-to-buy-drug-portfolio-from-mallinckrodt-4499775/

Piramal to buy drug portfolio from Mallinckrodt

Piramal Critical Care, the British subsidiary of Piramal Enterprises Ltd, would buy these drugs from Mallinckrodt.

Piramal Enterprises Ltd on Monday said that it had entered into an agreement to purchase a portfolio of pain management and intrathecal drugs — which are administered in the fluid-filled space under the lining of brain or spinal cord — from the British company Mallinckrodt LLC in an all-cash deal of about $203 million (Rs 1,380 crore).

Piramal Critical Care, the British subsidiary of Piramal Enterprises Ltd, would buy these drugs from Mallinckrodt. The deal will consist of $171 million of fixed consideration, of which 10 per cent, or $17 million, will be paid when the deal is finally closed. An additional $154 million will be paid on the first anniversary of the closing date. The remaining total consideration of up to $32 million is dependent on the gross profit of the Mallinckrodt’s Gablofen products in 2018 and 2019.

Watch What Else Is making News

The drug portfolio acquired by Piramal includes Gablofen (baclofen), a severe spasticity (a muscle control disorder) management product, which is currently marketed in the US, and two pain management products, which are currently under development.

“While net sales for our intrathecal therapy business have increased about 50 per cent since 2012 and it has become significantly more profitable, the products have limited commercial synergy with other parts of our growing specialty brands segment. The sale of this business to Piramal is the best solution to meet patient needs and will free resources for us to invest in additional growth,” said Mark Trudeau, president and chief executive officer of Mallinckrodt.

Advertising

Gablofen is the only FDA-approved baclofen in pre-filled syringes and factory-sealed vials. “Mallinckrodt also has a higher Gablofen concentration in late-stage development which, if approved, would help address physicians’ demand for more refill options. Both currently marketed intrathecal products and those in development are included in the transaction,” Mallinckrodt said in its press statement. The transaction is subject to customary closing conditions, and Mallinckrodt is expecting to complete the transaction in the first quarter of 2017 itself.

Ajay Piramal, chairman, Piramal Enterprises Ltd, said: “We continue to invest in the growth of our pharmaceutical businesses. This would be our seventh pharma acquisition in the last two years, taking our investment for inorganic growth to Rs 3,000 crore across our pharmaceutical businesses. All these acquisitions are expected to be value accretive.”