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Allergan intends to purchase Inamed
Inamed’s board of directors has advised its shareholders to accept the offer.
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Allergan has made an offer to buy Inamed for about $3.2 billion, and Inamed’s board of directors has unanimously recommended that its shareholders accept the offer.
The Inamed board of directors decided that the offer from Allergan was “superior” to an agreement Inamed entered into with Medicis in March 2005; that deal was valued at about $2.8 billion. The Medicis board declined to increase its initial offer, and Inamed chose to pay Medicis a $90 million termination fee to cancel the earlier agreement.
The status of the offers and counter-offers for the cosmetic surgery company have been announced in a series of press releases from the parties involved over the past several months.
Inamed markets a range of dermal products to treat facial wrinkles, including Hylaform Plus, Zyderm, Zyplast, CosmoDerm and CosmoPlast; breast implants for aesthetic augmentation and reconstructive surgery; and devices for obesity intervention.
In a Web cast on Nov. 15, David E.I. Pyott, Allergan’s president, chairman of the board and chief executive officer, said that the combined company would “create a world leader in medical aesthetics with significant cross-marketing and cross-selling opportunities.”
Terms of the proposed deal include a price per share of $84 in cash or 0.8498 a share of common Allergan stock for Inamed shareholders. In a letter to Nicholas L. Teti, chairman, president and chief executive officer of Inamed, Allergan said the transaction “also will result in the combination of two strong companies and will afford the opportunity to mutually enhance our skills.”
Potential outcomes
In preparation for the merger, U.S. marketing rights for Reloxin (botulinum toxin type A) have been returned to Beaufour Ipsen from Inamed. That drug, if approved by the Food and Drug Administration, would compete with Allergan’s Botox Cosmetic (botulinum toxin type A) in the U.S. market.
Reloxin is marketed outside the United States by Beaufour Ipsen as Dysport and is in clinical trials for FDA approval in the United States. Inamed has been responsible for handling the U.S. clinical trials and regulatory submissions for the product under an agreement with Beufour Ipsen in 2002.
Reloxin vs. Botox |
William J. Lipham, MD, of Minnesota Eye Consultants, has experience with both Botox Cosmetic and Reloxin. He said that the two products are similar, but they have differences that may allow them to be marketed for different indications. “I think they are going to be marketed as different compounds. Reloxin is felt to have a lower molecular weight, and it’s also felt to be in some sense less antigenic,” he said. Dr. Lipham said the low molecular weight of Reloxin could affect how it moves from the injection site. He also said that different proteins are used to stabilize the compounds in each product, giving them a slightly different makeup and dosage. “I think that [Reloxin] may be better for treating larger muscle groups, for spasticity, for example, as in cerebral palsy patients, because it has a greater tendency to diffuse,” Dr. Lipham said. He said that Beaufour Ipsen and its U.S. partner Inamed have been trying to get Reloxin approved for the treatment of spasticity, even though, like Botox, doctors may use it for off-label applications. “Botox was used for a number of years, from 1993 to 2003, in an off-label fashion for cosmetic purposes,” he said. “It was only FDA-approved for spasticity, as well as strabismus and some other indications.” |
For Your Information: |
When Allergan completes its merger with Inamed, Ipsen will take back the U.S. rights to the drug, according to a press release from Allergan. Ipsen will pay Inamed $10 million to recover the rights to the drug, according to a Dow Jones news report. Until the merger is completed, Inamed retains responsibility for phase 3 trials of the drug.
Should Inamed agree to Allergan’s proposal, the presumed closing would be in January 2006, Mr. Pyott said.
He said pro forma ownership will be split, with about 88% to Allergan and 12% to Inamed. Mr. Pyott also said that in lieu of hiring new salespeople for Botox, Allergan would integrate some of the Inamed sales force.
“From a financial point of view, Allergan will have the synergies related to costs by avoiding having to go out and hire people,” Mr. Pyott said.
Allergan has “an unwavering commitment to specialty pharma strategies,” Mr. Pyott said. He noted that if the acquisition is approved, ophthalmology will decrease as a percentage of the combined company’s revenues, from 58% to 49%.
“Our job is to build billion-dollar franchises, or at least half-billion dollar franchises,” Mr. Pyott said.
For Your Information:
- Allergan Inc. can be reached at P.O. Box 19534, Irvine, CA 92623; 714-246-4500; fax: 714-246-4971; www.allergan.com.
- Inamed Corp. can be reached at 5540 Ekwill St., Santa Barbara, CA 93111; 805-683-6761; fax: 805-692-5432; www.inamed.com.
- Jared Schultz is an OSN Staff Writer who covers all aspects of ophthalmology. He focuses geographically on Europe and the Asia-Pacific region.
- Michelle Dalton is Managing Editor of OSNSuperSite.com. She writes daily updates on developments in all aspects of ophthalmology.