Week of October 29, 2018 | Vol. 7, Issue 43
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In This Issue
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Contact Information
Managing Director
Business Development
Jeremy C. Johnson
Managing Director
Head of M&A and Capital Advisory
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INDUSTRY M&A SNAPSHOT
Above is an overview of recent industry M&A activity. For additional information, see the charts below or click on the chart above to download complete transaction tables broken out by industry subsectors.
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Consumer deal fever hits Johnson & Johnson with $2.1B deal to buy out Japan's Ci:z
Add another Big Pharma company to the wheeling and dealing in consumer health.
J&J plans to pay 230 billion Japanese yen ($2.05 billion) in cash to acquire the share of Ci:z it doesn't already own, gaining several lines of medical cosmetic products in the process, including Dr.Ci:Labo, Labo Labo and Genomer. The deal will give J&J's skincare franchise-which already sells such popular brands as Neutrogena-additional heft in Japan and other Asian markets. Ci:z will bolster J&J's offerings "by bringing in an agile innovation model and rapidly accelerating sales through our global commercialization expertise," said J&J consumer chief Jorge Mesquita in a statement. The company depicts the transaction as a "springboard" to building its commercial capabilities "by leveraging one of the largest customer relationship management databases for direct-to-consumer skincare in Japan." Through its affiliate Cilag, the U.S. Big Pharma acquired 19.9% of the Japanese company in 2016-the same year it took over New Jersey-based dermocosmetics firm NeoStrata-and got exclusive ex-Japan rights to those Ci:z skin care products. Now, to devour the entire company, J&J is offering 5,900 yen per share, which represents a 55% premium over Tuesday's closing price. The monetary size of the deal matches up to what J&J will glean from selling its diabetes monitoring unit LifeScan to a private investment firm. J&J said it would launch the Ci:z tender offer Oct. 29 and hopes to complete the deal in the first half of 2019.
C
ontinue Reading at Fierce Pharma
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Pfizer, Bain Capital Launch Neuroscience Company Backed With $350M
Pfizer and Bain Capital have created a new spinoff company that will focus on developing therapies for central nervous system disorders including Alzheimer's disease.
In January, Pfizer announced it planned to shut down work on its neuroscience programs, cutting roughly 300 related research positions in the process. The move, Pfizer said, reflected a decision to reallocate resources to areas where the company believes there is a greater chance to succeed. Through Cerevel, the pharmaceutical giant will forgo a financial investment yet keep some skin in the game by receiving a 25% stake in exchange for contributing a group of therapeutic candidates. Bain will supply the cash, with an initial $350 million coming from its private equity and life sciences divisions. Cerevel set some lofty ambitions in its Tuesday roll-out. Adam Koppel, a managing director at Bain Capital Life Sciences, said Cerevel aims to become a leader in neurology and neuropsychiatry. In a roll-out video for Cerevel, Koppel explained that the pharmaceutical industry's focus in oncology, immunology and rare diseases left opportunities in neurology for the new company. Joining Koppel on Cerevel's board from Bain is Chris Gordon, a managing director for the private equity vertical. In the video, Gordon indicated the company will potentially look for M&A opportunities to further expand its pipeline.
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An Overview of Transactions Within Market Subsegments
Below are summaries and charts with the past week's transactions from the different healthcare sectors. For a detailed table showing data for each industry transaction click on any of the charts. Total transaction values are provided in USD millions.
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Pharma & Biotech
10 transactions totaling $177 million
Supplies, Equipment & Services
16 transactions totaling $169 million
Healthcare IT & Managed Care
5 transactions totaling $1 million
Healthcare Facilities & Distributors
17 transactions totaling $3,865 million
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Pharma & Biotech
34 private placements totaling $561 million
Supplies, Equipment & Services
17 private placements totaling $344 million
Healthcare IT & Managed Care
7 private placements totaling $117 million
Healthcare Facilities & Distributors
2 private placements totaling $143 million
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Pharma & Biotech
8 public offering totaling $211 million
Supplies, Equipment & Services
4 public offerings totaling $91 million
Healthcare IT & Managed Care
1 public offering totaling $2 million
Healthcare Facilities & Distributors
1 public offering totaling $14 million
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Each week, w
e provide updated trading
comps for leading comp-
anies from numerous healthcare subsectors.
To the right you will see a high-level breakdown of median revenue and EBITDA multiples for each of the specific sub sectors.
For a complete trading comp analysis (including the individual equities that comprise the sub sectors), click on the table to the right.
Note: data reflects prior week close.
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RECENT INDUSTRY HEADLINES
A Sampling of Relevant Industry Headlines from the Last Week
Below are snippets from relevant industry news articles from the past week. For additional information or the article's complete text, click the headline link to view the original publication.
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October 26, 2018 - BioPharma Dive
AbbVie will take full control of development and commercialization of a slate of cystic fibrosis drugs that it's developed through a collaboration with Galapagos, betting on the potential of bringing to market a triple-combination therapy for the lung disease. In return, Galapagos will receive $45 million upfront, with another $200 million in future milestone payments as well as single digit to low teens royalties on any eventual sales of the cystic fibrosis drugs.
October 25, 2018 - Bio Space
Trethera Corporation (Trethera), a biopharmaceutical company committed to developing novel drugs targeting cellular nucleotide metabolism for the treatment of cancer, and
KYAN Therapeutics, an artificial intelligence-based drug development firm, announced an agreement to collaborate on preclinical studies evaluating up to four different tumor types
October 25, 2018 - Fierce Pharma
Johnson & Johnson has big ambitions in vaccines, and to get there, its manufacturing has to measure up. The small plant acquired in its Crucell purchase just won't support its advancing pipeline candidates-and certainly not product launches down the road. That's why the company targeted a new plant in Leiden, the Netherlands, for expansion
October 24, 2018 - BioPharma Dive
Alexion's had a healthy list of partners and acquisitions in 2018 as the company prioritized building out its pipeline. With Soliris (eculizumab) growing into a commercial success, Alexion is eyeing what comes next. In total, four pipeline-expanding deals this year have brought Alexion a host of new drug candidates, while costing the company more than $1.2 billion upfront and possibly more than $1.4 billion in milestone payments down the line.
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