Week of February 26, 2018 | Vol. 7, Issue 8
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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.
Merck Inks $394M Takeover Of Oncolytic Virus Play Viralytics
The takeover will give Merck control of an oncolytic immunotherapy that Viralytics is testing in combination with Keytruda in early-phase trials. 

Sydney-based Viralytics' most advanced candidate is Cavatrak, a common cold RNA virus. Viralytics selected the nongenetically altered virus on the strength of its ability to target ICAM-1 and infect a variety of cancer cells. Once inside the cells, the virus starts wiping out the tumor through oncolytic and immunotherapeutic activity. That mechanism chimes with Merck's strategy.  "Viralytics's approach of engaging the innate immune system to target and kill cancer cells complements our immuno-oncology strategy," Roy Baynes, head of global clinical development at Merck Research Laboratories, said in a statement. "We are eager to further build on Viralytics's science as we continue our efforts to harness the immune system to improve long-term disease control and survival outcomes for people with cancer."

C ontinue Reading at  Fierce Biotech.
Gilead, Sangamo Strike $3 Billion Off-The-Shelf CAR-T Deal
Gilead's Kite has struck a $3 billion deal to access Sangamo Therapeutics' zinc finger nuclease (ZFN) technology. 

Kite will use the ZFN gene editing platform to create next-generation, off-the-shelf CAR-T therapies to cement its position as a long-term front-runner in the growing cell therapy space.  Sangamo is giving Kite the exclusive right to use its ZFN platform to create allogeneic and autologous anticancer cell therapies. For Kite, that expands the toolkit it can apply to its R&D projects while also serving to keep the technology out of the hands of Novartis, Celgene's Juno and the other CAR-T runners and riders. In return, Kite is paying Sangamo $150 million upfront and committing to $3 billion in milestones. The milestones are tied to the success of 10 or more products that could potentially use Sangamo's technology. Full details of how those pipeline prospects will differ from the first wave of CAR-T therapies are yet to emerge. But Gilead's release put a discussion of the potential to use the gene-editing technology in off-the-shelf cell therapies up top. As Gilead noted, off-the-shelf cell therapies eliminate the need to process a patient's own cells, thereby cutting the time it takes for them to receive an infusion.

C ontinue Reading at  Fierce Biotech.

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
 11 transactions totaling $1,664 million 
 Supplies, Equipment & Services
 20 transactions totaling $6 million
 Healthcare IT & Managed Care
 3 transactions 
 Healthcare Facilities & Distributors
 8 transactions totaling $94 million

Pharma & Biotech
25 private placements totaling $502 million
Supplies, Equipment & Services
13 private placements totaling $182 million
Healthcare IT & Managed Care
4 private placements totaling $12 million
Healthcare Facilities & Distributors
1 private placement totaling $55 million

 Pharma & Biotech
 11 public offerings totaling $713 million
 Supplies, Equipment & Services
 9 public offerings totaling $1,582 million
 Healthcare IT & Managed Care
 0 public offerings
 Healthcare Facilities & Distributors
 4 public offerings totaling $123 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.
February 22, 2018 -  BioSpace
Glenmark Pharmaceuticals, a global pharmaceutical company, today announced it has entered into an exclusive agreement with Sam Chun Dang Pharm. Co. Ltd. (SCD), to develop, manufacture and market a portfolio of ophthalmic products in the U.S. and Canada. Under this agreement, these products will be developed and manufactured by SCD in South Korea. Glenmark will seek all market authorizations and commercialize the products in North America.

February 21, 2018 -  The Wall Street Journal
Two large hospital systems in the U.S. Midwest and Mid-Atlantic announced plans to merge, in another example of hospitals bulking up as the battle for patients grows increasingly fierce.  A combination of Bon Secours Health System Inc., a nonprofit based in Marriottsville, Md., and Mercy Health, a nonprofit headquartered in Cincinnati, will rank as one of the largest chains nationwide, with 43 hospitals and operations in seven states.

Amazon breaks into drug sales with Perrigo's store-brand OTC medications
February 21, 2018 - Fierce Pharma
While industry watchers were eagerly anticipating Amazon's move into prescription drugs, the e-commerce behemoth snuck into over-the-counter sales with help from store brand expert Perrigo.  Amazon rolled out a line of consumer health products, called Basic Care, in August, CNBC reported. The portfolio-consisting of 60 Perrigo-made treatments-sets Amazon up to put the squeeze on retailers of OTC therapies, giving the Dublin drugmaker a boost in the process.

Ionis farms out antisense drug to AstraZeneca in deal worth up to $330M 
February 20, 2018 -  Fierce Biotech
Ionis Pharmaceuticals  has licensed an antisense drug to AstraZeneca, picking up a $30 million payment in the process. The British pharma will take over the development and commercialization of IONIS-AZ5-2.5Rx, which is designed for the treatment of kidney disease. "This is the second drug to enter development under our strategic collaboration with AstraZeneca in cardiovascular, metabolic and renal diseases. IONIS-AZ5-2.5Rx is being developed to treat a genetically associated form of kidney disease with a high unmet medical need," said Brett Monia, COO and senior vice president of antisense drug discovery and translational medicine at Ionis, in a statement.

AbbVie doubles down on tau with Voyager Alzheimer's deal
February 20, 2018 -  Fierce Biotech
AbbVie has teamed up with Voyager Therapeutics on a tau protein-targeting program, paying $69 million upfront for an option on the Alzheimer's disease candidate. The duo says they will apply Voyager's gene therapy vector expertise to develop a one-off Alzheimer's treatment that uses adeno-associated virus (AAV) vectors to produce 'vectorized' anti-tau antibodies within the brain. According to AbbVie, that approach would have dosing advantages over current tau-targeting drugs in the industry's pipeline that could translate into a higher chance of showing efficacy.   

Aimmune aces peanut allergy phase 3, teeing up FDA filing
February 20, 2018 -  Fierce Biotech
Aimmune has presented  strong data from a phase 3 trial of its peanut allergy treatment AR101. The Brisbane, California-based biotech plans to file for FDA approval by the end of 2018 to give patients a way to protect themselves against accidental exposure to peanut protein. Investigators enrolled almost 500 children intolerant to peanut protein doses of 100mg or less and randomized them to receive AR101 or placebo. After a 22-week dose escalation phase, participants continued to take 300mg a day of peanut flour AR101 or placebo until the end of the 12-month study. The patients were then given consecutive doses of peanut protein rising from 3mg to 1000mg to assess their ability to tolerate the allergen.
Current Opportunities Available Through Bourne Partners
Project Longhorn 
Sell-side M&A
Southeastern US  |  CDMO  |  Approximately $85mm Revenue  |   Approximately $8mm EBITDA

Project Crimson 
Sell-side M&A
Southeastern US  |  CMO  |  Approximately --- Revenue  |   Approximately --- EBITDA

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

Project Magnolia 
Sell-side M&A
Mid-Atlantic US  |  CRO  |  Approximately $25mm Revenue  |   Approximately NM EBITDA
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
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Charlotte, NC 28202