Endo Pharmaceuticals and Indevus Pharmaceuticals, Inc. announced today that they have entered into a merger agreement under which Endo will commence a tender offer to acquire 100 percent of the outstanding shares of Indevus for approximately $370 million, or $4.50 per Indevus share, in cash, and up to an additional approximately $267 million, or $3.00 per Indevus share, in cash payable in the future upon achievement of certain regulatory and sales milestones.
The transaction has been approved by the boards of directors of both companies.
David Holveck, president and chief executive officer of Endo, stated, "This merger reflects our desire to expand our business beyond pain management into complementary medical areas where we can be innovative and competitive. We believe this expansion of our product line has significant growth potential because of the therapeutic value of the Indevus product portfolio, the unique expertise of both companies, and the demographic, health care and reimbursement trends that favor the consideration of new products to address unmet needs in urology and endocrinology.
"These trends demand that pharmaceutical companies become better health care partners with physicians and managed care organizations by offering a range of new products and technologies in related medical specialties that achieve better outcomes for patients. This transaction represents a unique opportunity for us to achieve these goals. The combined company will market nine products through three specialty sales forces and have the capability to develop innovative new therapies using a novel drug delivery technology. We believe this will make Endo a stronger competitor, a more valuable health care supplier and a more successful company."
Indevus chairman and chief executive officer, Glenn L. Cooper, M.D., stated, "This transaction allows us to capture significant value for our shareholders and create new value for patients, physicians and shareholders of both companies under Endo's leadership. We believe Endo's proven commercial capabilities, targeted approach to medical marketing and unique understanding of the changes taking place in health care delivery today will ensure the success of our current and future products. We welcome and fully support this acquisition."
Endo expects that the transaction will be dilutive to the company's earnings in 2009 and is targeted to become accretive to Endo's earnings in 2010. Endo expects to achieve up to $40 million in cost savings and will provide more complete financial guidance during its fourth quarter and full-year earnings conference call in February.
Novel Products and Drug-Delivery Technology
Endo currently markets proprietary and generic products for the treatment and management of pain. Indevus currently markets products to treat overactive bladder, prostate cancer and central precocious puberty and is pursuing regulatory approval of drugs to treat hypogonadism and bladder cancer.
Mr. Holveck noted, "In addition to the very successful drug, VANTAS(R), we are particularly excited about the opportunity to add three innovative drug therapies, SUPPRELIN(R) LA, NEBIDO(R) and octreotide implant, to our product portfolio. All three are intended to address significant patient needs in under-served medical markets, while SUPPRELIN LA and octreotide use the patented HYDRON drug delivery technology which may also have utility in pain management."
SUPPRELIN LA is a currently marketed product that provides a continuous, 12-month, controlled dose of histrelin to treat central precocious puberty. It employs the HYDRON Implant, a subcutaneous, retrievable, non-biodegradable, hydrogel reservoir drug delivery device designed to provide sustained release of a broad spectrum of drugs continuously, at constant, predetermined rates. The HYDRON Implant is the only soft, flexible, reservoir-based drug delivery system designed for easy, in-office physician insertion under local anesthesia.
NEBIDO is a novel, long-acting injectable testosterone depot being developed for the treatment of male hypogonadism. Indevus is currently preparing a complete response for submission to the U.S. Food and Drug Administration in the first half of 2009 to support regulatory review of the company's pending application to market NEBIDO as the first long-acting testosterone preparation available in the United States.
Octreotide implant is in Phase III clinical testing for the treatment of acromegaly, a chronic hormone disorder resulting from excessive production of growth hormone. It utilizes HYDRON polymer technology to deliver six months of octreotide.