Biotech Values

[DewDiligence]

Pfizer acquires Esperion for $1.3B:

[Pfizer had the right of first refusal on Esperion’s lead product candidate ETC-216, which is in phase 2 and has a novel mechanism of action to treat (or prevent) cardiovascular disease by raising HDL, the “good” cholesterol. Pfizer presumably saw the risk of letting this product get into the hands of a competitor to be a risk to Pfizer’s enormous Lipitor franchise. (Lipitor is the world’s largest-selling drug.) Still, $1.3B is a nice chunk of change for a still-unproven drug in phase 2 that is a long way from approval. Hence, this deal may create some significant new buzz about the values of development-stage biotech companies, and that can’t be bad!]

http://biz.yahoo.com/prnews/031221/nysu013_1.html

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Pfizer to Acquire Esperion Therapeutics to Extend Its Research Commitment In Cardiovascular Disease

Sunday December 21, 1:06 pm ET

NEW YORK and ANN ARBOR, Mich., Dec. 21 /PRNewswire/ -- Pfizer Inc today announced it has entered into an agreement to acquire Esperion Therapeutics, Inc., a biopharmaceutical company focused on the development of high density lipoprotein (HDL) targeted therapies for the treatment of cardiovascular disease.

Pursuant to this agreement, Pfizer will commence a cash tender offer to acquire the shares of Esperion stock for $1.3 billion at a price of $35 per share, subject to certain conditions. This price represents a 54 percent premium over Esperion's average closing share price during the last 20 trading days.

Esperion Therapeutics brings a novel approach to the emerging area of HDL Therapy and reverse lipid transport for the acute treatment of cardiovascular disease. Recently, Esperion published positive Phase II results on a biopharmaceutical compound (ETC-216) that showed a statistically significant reduction in plaque volume in patients with acute coronary syndrome at the end of six weeks. Esperion also has a second biopharmaceutical compound, ETC-588, in Phase II and a number of early-stage compounds.

"By acquiring Esperion, we can bring our research capabilities to bear on an emerging new area which has potentially significant beneficial impact on patients", said Hank McKinnell, chairman and chief executive officer of Pfizer. "Epidemiologic data and drug intervention trials both support a strong correlation between higher HDL levels and improvements in morbidity and mortality."

"The acquisition will enable us to utilize Pfizer's skills and apply the resources necessary to develop our pipeline of compounds to benefit patients with atherosclerosis", said Roger Newton, president and chief executive officer of Esperion. "We are pleased to have the opportunity to work with the world leader in cardiovascular medicines to develop HDL-focused therapies."

The Pfizer product Lipitor is the world's most prescribed agent for reducing low density lipoprotein (LDL). Pfizer is also developing Lipitor/torcetrapib, which works by combining Lipitor with an agent that inhibits the action of cholesteryl ester transfer protein or CETP. Results of Phase II studies indicate that this combination may represent a significant advance in preventive cardiovascular medicine by enhancing the LDL-lowering effect of Lipitor while also increasing HDL or "good" cholesterol.

While both Lipitor and Lipitor/torcetrapib are chronic therapies, Esperion has three clinical compounds that are being developed as acute, hospital-based treatments to regress arterial plaque and thereby reduce morbidity and mortality in patients who have had a cardiovascular event.

Atherosclerosis, which is a leading cause of death from heart attack and stroke, occurs when there is a build-up of cholesterol-rich fatty areas called plaques in the arteries. The break-up and dispersal of these plaques can block the blood flow throughout the body, which can be fatal. It is estimated that atherosclerosis accounts for more than 75 percent of all deaths from cardiovascular disease.
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Based in Ann Arbor, MI, Esperion was founded by a group of scientists who worked on the discovery and development of Lipitor. Esperion will operate as a division of the Pfizer Global Research and Development organization, and remain in Ann Arbor.
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