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Shire expands rare disease reach with Viropharma Purchase

Authored by James Sheppard

Shire has made its first significant acquisition since the arrival of new CEO, Flemming Ornskov. Shire announced that it had successfully acquired US based rare disease specialist Viropharma. Shire has agreed to pay $4.2bn for Viropharma and its portfolio of rare disease drugs.

Viropharma currently has three marketed products all indicated for rare diseases. Cinryze is the company’s lead asset and is approved for the treatment of immune disorder hereditary angioedema. Cinryze is approved for sale in the USA and EU and work is ongoing to get Cinryze approved in multiple international markets.  Further to this Shire has gained access to Viropharma’s pipeline which includes drugs in development for c.diff, seizures in adults and children, adrenal insufficiency in adults as well as a number of other early stage investigational products. Viropharma and its rare disease expertise will fit into Shire’s rare disease portfolio.

Shire has agreed to pay $50 a share for Viropharma which is a 27% premium on the closing share price. The purchase will take Shire’s rare disease revenue to in excess of $2bn or 40% of Shire’s total revenue. Shire Chief Executive Flemming Ornskov said the deal was ‘entirely consistent with our clear strategic objective of strengthening our rare disease portfolio.’ Flemming Ornskov also did not rule out the possibility of more acquisitions in the area of rare diseases.

The deal capped a busy week for Shire in which it announced they would be cutting up to 180 R&D jobs at its UK base in Basingstoke. Further to this Shire will be relocating its offices from Eysins (just outside Geneva, Switzerland) to Zug in east Switzerland. Part of the restructure announced by Ornskov was aimed at restructuring the company’s pipeline to be more aligned rare diseases and drop a number of undisclosed research programs. The Viropharma purchase fits into this newly aligned strategy.

The deal which is Shire’s largest to date continues Ornskov’s policy to continue building Shire’s pipeline through acquisitions. The Viropharma purchase adds to the earlier purchases of SARCode and Lotus Tissue Repair. Dr Ornskovs start in his new position has been widely positive with analysts and investors alike heaping praise on the early days of Dr Ornskovs tenure.

Posted in M&A Finance and Funding, Orphan Drugs and Rare Diseases, Pharmaceutical business | Tagged , , , , , , , , , , , , , , , , , , , , | Leave a comment

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