Basel, Switzerland (4E) – Roche, the Swiss pharmaceutical giant, had formalized an agreement to purchase InterMune for the price of USD8.3 billion. This is another move by the company to expand its product line and increase its overall revenues.
The total price redounds to about USD74 per share, which is a 63% upgrade on the closing price of the share of InterMune last August 12. InterMune’s main drug is a treatment for a deadly lung disease. Based out of Brisbane, CA, the company developed pirfenidone which treats idiopathic pulmonary fibrosis, a form of scarring of the lungs that prove fatal. The drug is marketed as Esbriet in Canada and Europe, have received approvals in 2011 and 2012. It can be made available in the US by November.
This year saw a busy season for deals with pharmaceutical companies, as it totaled USD87 billion worth of deals in June. According to the media survey group EvaluatePharma, the price tag for this year is nearing the total earnings for 2009, which was at USD152 million.
Roche remained conservative in the market, notching its only major acquisition back in 2009, when it purchased interest in biotech Genentech for USD46.8 billion that it did not already own. After several tries, Roche found InterMune. InterMune has a drug that has been approved and available to the public.
The illness InterMune treats is called idiopathic pulmonary fibrosis which affects 100,000 individuals in the United States. While there has been no findings as to it cause, it affects the lung tissue to a point that scar tissue thickens that it hampers oxygenation of blood for the organs to use. This disease affects adults, elderly in particular and they die three to five years after diagnosis.
According to Roche CEO Severin Schwan, in an interview with CNBC, said that InterMune’s portfolio ‘has medical differentiation that fits very well with our pulmonary portfolio.’ This was seconded by InterMune CEO Dan Welch, who said, “Roche shares our passion and commitment to the IPF community and to ensuring that pirfenidone is available as quickly as possible to patients in the United States, pending approval.”
This is also a recognition that Roche, with its scope and ability, would be able to help in launching the drug as well as have resources gaining approvals and eventually marketing it to the general public.
With the drug, Roche would be able to have this as part of a spectrum of drugs for lung disease management. It already has Pulmozyme for cystic fibrosis and Xolair for asthma. There are also other experimental drugs being developed under the auspices of the research and development department of the Swiss drugmaker.
Schwan lauded the employees of InterMune, saying with this acquisition, Roche would still rely on their expertise. He added, “We rely on the employees from InterMune. They have more than a decade of experience in this very specific field. This is not about cost synergies at all. This is a growth story.” The plan is to keep the organization intact, synergizing with Roche throughout all the processes of drug development.