Week of April 30, 2018 | Vol. 7, Issue 17
In This Issue


Quick Links

Contact Information
Managing Director
Business Development

Jeremy C. Johnson
Managing Director
Head of M&A and Capital Advisory

Above is an overview of recent industry M&A activity. For additional information, see the charts below or follow the link to the left to download complete transaction tables broken out by industry subsectors.

See below for additional information about industry trading comps and transaction relevant articles from the past week.
Shire And Takeda Come To Terms With A $64B Deal, The Biggest Pharma M&A In Years
The deal still has to be approved by both boards and is subject to due diligence

We have a deal-a preliminary one, at least.  Late Tuesday, after a fifth buyout offer from Takeda, Shire said  the Japanese drugmaker had finally landed on a proposal worth recommending to shareholders. It's a cash-and-stock bid now worth $64 billion or so, about $4 billion more than its first offer. The U.K.'s takeover board, which has strict rules for the timing and disclosure of bids, extended a deadline to give Takeda and Shire until May 8 to wrap it up. In per-share terms, Takeda would fork over 0.839 new Takeda shares and $30.33 in cash for each Shire share. Based on Takeda's share price at Monday's close, that's £49 per share, Shire said in a statement-and £5 per share more than its first bid. That share price is a moving target, though; Takeda's stock plummeted by 7% on the news Wednesday morning. Structured this way, the deal "seems to be much more of a merger," Bernstein analyst Ronny Gal pointed out in a note to clients. Shire shareholders will receive 50% of the value of the combined company, and the companies will do reciprocal due diligence before any deal closes.

C ontinue Reading at Fierce Pharma .
Humana, PE Firms Plan To Buy Hospice Operator Curo Health For $1.4 Billion
This is the latest deal in a rapidly consolidating healthcare sector, with companies looking for new ways to bolster profits. 

Humana Inc is teaming up with two private equity firms to buy privately held Curo Health Services for about $1.4 billion, the group's second such deal in five months that will create the largest hospice operator in the United States. The consortium, which includes TPG Capital and Welsh, Carson, Anderson & Stowe, will merge Curo with the hospice business of Kindred Healthcare Inc, which it agreed to buy in December for about $810 million. Reuters reported last month that Walmart Inc was in early-stage talks with Humana for developing closer ties, with the acquisition of Humana being discussed as one possibility.  "We view the (Curo) acquisition as financially prudent for Humana but without a majority ownership position, achieving its operational goals could be more challenging," Cantor Fitzgerald analyst Steven Halper wrote in a note.  The deal indicates that Humana should not be viewed as a takeover target, Halper added, saying that a deeper relationship between Humana and Walmart is entirely possible.

C ontinue Reading at Reuters .

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 or use the download link above. Total transaction values are provided in USD millions.

 Pharma & Biotech
 20 transactions totaling $478 million 
 Supplies, Equipment & Services
 14 transactions totaling $359 million
 Healthcare IT & Managed Care
 4 transactions totaling $2,153 million
 Healthcare Facilities & Distributors
 6 transactions totaling $7,110

Pharma & Biotech
20 private placements totaling $1,085 million
Supplies, Equipment & Services
15 private placements totaling $272 million
Healthcare IT & Managed Care
6 private placements totaling $76 million
Healthcare Facilities & Distributors
3 private placements totaling $118 million

 Pharma & Biotech
 5 public offerings totaling $278 million
 Supplies, Equipment & Services
 5 public offerings totaling $1,214 million
 Healthcare IT & Managed Care
 2 public offerings totaling $2,237
 Healthcare Facilities & Distributors
 2 public offerings totaling $82 million

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 or use the download link from the top of this newsletter. 

Note: data reflects prior week close.
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.
April 26, 2018 -  Bio Space
Endo International plc today announced that it has reached definitive agreements to acquire Somerset Therapeutics, LLC, a New Jersey based specialty pharmaceutical company that develops and markets sterile injectable and ophthalmic drugs for the U.S. marketplace, and the business of its India based affiliate Wintac Limited, which operates as Somerset Therapeutics' contract developer and manufacturer. Endo is paying approximately $190 million in total for Somerset Therapeutics and Wintac's business. Together, the acquisitions will secure for Endo's Par Sterile injectable business Somerset Therapeutics' commercial and pipeline products as well as Wintac's manufacturing capabilities for those products.

April 26, 2018 -  Reuters
Welltower Inc , a healthcare-focused real estate investment trust, will acquire Quality Care Properties for about $1.95 billion in cash, the companies said late on Wednesday. Concurrent with the $20.75 per share deal, Welltower formed an 80/20 joint venture with ProMedica Health System, a non-profit hospital network operator. The joint venture will contain the real estate of QCP's principal tenants, HCR ManorCare and Arden Courts.

April 25, 2018 -  Reuters
Australian hospital operator Healthscope Ltd said it had received a $3.1 billion buyout approach from a new but high-profile domestic private equity firm and its consortium partners just four years after listing. The indicative offer - one of the highest for an Australian firm in the past year - is an audacious debut for BGH Capital, named after ex-Macquarie banker Robin Bishop, and Ben Gray and Simon Harle, prominent dealmakers who used to lead the Australian team at TPG Capital Management.

Pernix and company ink $75M deal to put Orexigen out of its misery
April 24, 2018 -  Fierce Pharma
It's been a painful few years for Orexigen Therapeutics in the obesity arena, and the company is finally ready to bow out.  The San-Diego based drugmaker has inked a pact  with Nalpropion Pharmaceuticals-a new company funded in part by specialty drugmaker Pernix Therapeutics-to sell worldwide rights to obesity med Contrave and other assets for $75 million in cash.

Shire-hunting Takeda notches R&D collaboration with Nektar, pair to combo I-O drugs
April 24, 2018 -  Fierce Biotech
Takeda, with apparently near infinitely deep pockets for M&A and collaborations, has struck a deal: not to buy Shire, as yet, but rather with Nektar, as the two eye new trials of their respective immuno-oncology assets.  There's no money terms, but we know on the study side that Nektar will be putting on the table its experimental cancer drug NKTR-214, an immunostimulatory therapy designed to expand specific cancer-fighting T cells and natural killer cells directly in the tumor microenvironment, all the while boosting expression of PD-1 on these immune cells.  
Cedilla Therapeutics launches with $56M to target protein degradation in cancer
April 24, 2018 - Fierce Biotech
Cedilla Therapeutics launched Tuesday with a $56 million investment from Third Rock and a mission to develop small molecules that target the stability of cancer-driving proteins. Others have worked on degrading protein targets in the past, but they have not used small molecules to do it.  Other companies are working with what Chief Scientific Officer Brian Jones calls the downstream effector machinery. One approach blocks enzymes involved in ubiquitination, a process whereby a damaged or unneeded protein is tagged with the protein ubiquitin and then sent to a protein complex called a proteasome, where it is degraded. 

April 23, 2018 -  Reuters
Henry Schein Inc said on Monday it would spin off its animal health business and merge it with Vets First Choice to create a new company that will form an animal health service and technology platform to support the veterinary market. The company said Henry Schein shareholders will own approximately 63 percent of the new company and expects to receive between $1.0 billion to $1.25 billion in cash on a tax-free basis.

April 23, 2018 -  Reuters
Ping An Healthcare and Technology Co Ltd, a unit of Ping An Insurance (Group) Co of China Ltd , plans to raise up to HK$8.77 billion ($1.1 billion) in a Hong Kong initial public offering to help expand its e-commerce business. The unit, also known as Ping An Good Doctor, plans to sell a total of 160.09 million shares at up to HK$54.80 apiece, it said in a filing to the Hong Kong bourse on Monday.

April 23, 2018 -  Fierce Pharma
A year after inking its $4.3 billion Akorn buyout agreement, Fresenius intends to scrap the deal. Akorn, though, isn't having it, and analysts say a "legal battle royale" could be on the horizon.  The German drugmaker over the weekend said it was terminating its acquisition accord , and one reason it cited sounded quite ominous: An independent probe of Akorn's operations turned up "material breaches of FDA data integrity requirements," Fresenius said. Overall, it cited a "failure to fulfill several closing conditions" as a reason for its pullout.
Current Opportunities Available Through Bourne Partners
Project Limestone
Asset Divestiture
Southeastern US | ANDAs and Manufacturing Equipment | ANDA Revenue disclosed with NDA

Project Ocean 
Sell-side M&A
Northeastern US | CDMO | Approximately $6mm Revenue | EBITDA disclosed with NDA

Project Barracuda
Asset Divestiture
Midwestern US | Consumer Health/OTC | Approximately $31.5mm Revenue | Approximately $12mm EBITDA

Project Longhorn 
Sell-side M&A
Southeastern US | CDMO | Approximately $85mm Revenue | Approximately $8mm EBITDA
Bourne Partners Reports Providing Insight Into Healthcare & Related Industries
An Overview of Events Hosted or Attended by the Bourne Partners Team

April 30 - May 6, 2018  | Quail Hollow Club Charlotte, NC
As an international, healthcare-focused merchant bank and financial advisory firm, we provide world-class services and capital to middle-market healthcare companies around the globe.  We aim to keep our clients well-informed of healthcare news and events.  With this additional insight in mind, together, we can recognize trends and opportunities that benefit our clients.  We hope that you will reach out to Bourne Partners to help execute your healthcare operational and transactional needs.  To learn more about our firm, visit our website or utilize the links below to engage with us on social media. 


The Bourne Partners Team

Bourne Partners
550 South Caldwell Street
Suite 900
Charlotte, NC 28202