MergerMArket
Sucampo’s VTS-270 drug main driver in Mallinckrodt acquisition
27 DEC 2017
Mallinckrodt Pharmaceuticals’ [NYSE: MNK] USD 1.2bn acquisition of Sucampo Pharmaceuticals [NASDAQ: SCMP] was primarily motivated by Sucampo’s experimental rare-disease drug VTS-270, according to a person familiar with the situation.
A Mallinckrodt spokesperson said the company’s rationale was to further diversify its specialty brands business as well as bolster its pipeline. Sucampo declined to comment.
Rockville, Maryland-based Sucampo acquired VTS-270 in its purchase of Vtesse in April, for an upfront price of USD 200m. VTS-270 is an experimental treatment for Niemann-Pick type C, a disease that causes a genetic defect in how cells transport lipids. If VTS-270 is approved by the FDA, Mallinckrodt will receive a transferable Priority Review Voucher that is estimated to be worth between USD 125m to USD 130m, based on recent sales.
Mallinckrodt subsidiary Sun Acquisition will acquire Sucampo for USD 18 per share. Sucampo’s stock closed Friday at USD 17 per share. The deal is expected to close in 1Q18.
The person familiar with the situation said Sucampo saw Mallinckrodt as a strong suitor due to its global footprint and commercial infrastructure. Peter Greenleaf, chairman and CEO of Sucampo, said in a release that Mallinckrodt is a natural partner “to accelerate the development of our rare disease assets.” Mallinckrodt intends to build upon Sucampo’s existing commercial infrastructure for both VTS-270 and its other experimental rare disease drug, CPP-1X/sulindac.
Sucampo will continue to usher VTS-270 through Phase 3 development. VTS-270 received Orphan Drug Designation from the FDA in November 2016. Mallinckrodt expects to file the drug with the US regulator in 2018 and it could receive approval as early as 2019.
Deutsche Bank served as Mallinckrodt's financial advisor and the company’s legal advisor was Wachtell, Lipton, Rosen & Katz. Sucampo’s financial advisor was Jefferies and Cooley LLP acted as its exclusive legal advisor.
Mallinckrodt recently traded at USD 23.48.