Shire dispels doubts about New River acquisition
pharmafile | March 12, 2007 | News story | Sales and Marketing |
Shire has dismissed claims its acquisition of New River Pharmaceuticals is in doubt, after reports that a rival bid for the company is being prepared.
Shire is to raise $800m in equity finance through institutional investors to part-fund the proposed $2.6 billion purchase. It is still theoretically possible for another group to make a counter bid and The Independent newspaper quoted an unnamed analyst calling Shire's bid "a sitting duck waiting to be shot at". The move will give Shire control of what it hopes will be its future flagship brand Vyvanse (lisdexamfetamine), which is owned by New River.
The drug is currently under FDA review for the treatment of ADHD in children, but the newspaper report says at least four other pharma companies were interested in New River and had the company's Vyvanse attention deficit disorder treatment been approved as expected in December, the chances are that Shire would not have been the sole bidder.
Last month, Randal Kirk, founder and chairman of New River, said he was delighted with the Shire deal, and has praised Shire's development and marketing of Adderall XR, its own ADHD treatment.
Shire believes the deal will go ahead and sources there suggest that no other company has been in the frame during talks. The transaction has been unanimously approved by the boards of directors of both companies, with the tender expected to close in April or May. A spokesperson for Shire told Pharmafocus: "The price is a good premium and has been accepted by their board and the majority shareholder, who is chairman of the company."
The offer is subject to approval by Shire's shareholders, although Kirk has agreed to offer all his shares in New River – 50.2% of the total.
