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Sep
17
ragupathyrenganathan
Indian drug maker Sun Pharma to acquire US-based InSite Vision for $48m
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An indirect wholly-owned subsidiary of Sun Pharma will commence a tender offer for all of the issued and outstanding common stock of InSite Vision at a price of $0.35 per share in cash, a 30% premium to the implied price per share. Photo: Hemant Mishra/Mint

One of the subsidiaries of Sun Pharmaceutical Industries Ltd, the largest Indian drug maker, has entered into an agreement to acquire US-based InSite Vision Inc. in a deal worth $48 million, the company announced on Wednesday.

Under the terms of the agreement and plan of merger, an indirect wholly-owned subsidiary of Sun Pharma will commence a tender offer for all of the issued and outstanding common stock of InSite Vision at a price of $0.35 per share in cash, a 30% premium to the implied price per share, the statement said here.

The transaction has a total equity value of approximately $48 million on fully diluted basis plus related debt and other transaction costs, assuming all shares of InSite Vision are tendered in the offer. InSite Vision’s board of directors has also approved the transaction and unanimously recommended that its stockholders tender their shares pursuant to the tender offer.

For the six-month period ended 30 June 2015, InSite Vision recorded revenues of $3.8 million, an Ebitda (earnings before interest, tax, depreciation and amortization) loss of $6.4 million and a net loss of $7.5 million.

InSite Vision focuses on developing new specialty ophthalmic products, including three late stage programs. Sun Pharma, which is in the process of establishing a branded ophthalmic business in the US, will see the growth through acquisitions of InSite Vision, and recent in-licensing of Xelpros (Latanoprost BAK-free eye drops), a company statement said.

InSite Vision has developed the DuraSite and DuraSite2 drug delivery platforms which are capable of extending the duration of drug retention, thus resulting in lower dosing frequency, and potentially enhanced efficacy.

Based on this technology, InSite Vision has developed a pipeline of late-stage clinical candidates, and has recently filed a New Drug Application (NDA) with the US FDA for BromSite (0.075% bromfenac) for the treatment of inflammation and prevention of pain associated with cataract surgery. It plans to file another NDA in 2017 for DexaSite (0.1% dexamethasone) for the treatment of non-bacterial blepharitis, a common ocular condition for which there is no approved product currently available, it said.

It’s AzaSite Plus is currently in Phase-3 clinical development for the treatment of eye infections, and ISV-101 is in Phase 1/2 clinical development for dry-eye disease and inflammation.

As part of strengthening their presence in the US, Indian pharmaceutical companies are in an acquisition mode. In July, Lupin Ltd announced the acquisition of US generic drug maker Gavis Pharmaceuticals Llc for $880 million, recording the largest overseas acquisition by an Indian drug maker.

Cipla Ltd, the Mumbai-based pharma company getting less than 8% of its revenue from the US, the world’s largest pharmaceutical market, recently acquired US-based InvaGen Pharmaceuticals Inc.and Exelan Pharmaceuticals Inc. for $550 million.

Generic pharmaceuticals make up 80% of the prescriptions dispensed in the US but account for just 27% of total drug spending. The US generic drug market is estimated at an yearly $35 billion, more than double the Indian pharmaceutical market estimated at $14 billion (aroundRs.90,000 crore).

“The potential addition of the InSite Vision portfolio serves as a significant step towards enhancing our branded specialty pipeline in the Ophthalmic segment. InSite Vision will bring with it a pipeline of three late-stage clinical candidates, validated drug delivery technology and a track record of achieving US FDA approval for ophthalmic products,” said Jerry St. Peter, vice-president and head of Sun Pharma’s US ophthalmic business.

This article was first published on Livemint.com



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