OPK,
They are buying a company for that 100 million,so they are getting value.
Opko Health signed a deal to acquire Canadian drug company Cytochroma, which has two products in Phase 3 clinical trials, for $100 million.
The Miami-based pharmaceutical and biotechnology company (NYSE: OPK) would issue shares of its stock as compensation for the deal, its second acquisition in the past two months after buying a pharmaceutical company in Brazil in December.
Both of Cytochroma’s products involve patients with kidney problems. Replidea is a vitamin D prohormone to treat secondary hyperparathyroidism (SHPT) in patients with stage 3 or 4 chronic kidney disease in addition to vitamin D insufficiency. More than eight million patients have stage 3 or 4 chronic kidney disease, according to the National Kidney Foundation. About 70 to 90 percent of such patients have vitamin D insufficiency and 40 to 60 percent of them have SHPT.
Alpharen is a non-absorbed phosphate binder to treat hyperphosphatemia, or elevated serum phosphorus, in dialysis patients, who commonly experience this program.
“OPKO intends to market Replidea along with our proprietary point-of-care vitamin D diagnostic test currently in development,” Opko Chairman and CEO Dr. Phillip Frost stated in a news release. “We envision these remarkable products as part of the foundation for a new and markedly improved standard of care for chronic kidney disease patients having SHPT and/or hyperphosphatemia.”
Following the acquisition, Cytochroma CEO Charles W. Bishop and business manager Eric J. Messner will join Opko.
Opko will issue 20.5 million shares, at $4.87 per share, as part of the $100 million price for Cytochroma. The sellers could receive an additional $190 million in cash of additional shares should the acquired drugs meet certain milestones in both development and revenue.
According to Yahoo Finance, Opko has 298 million shares outstanding. The company's shares were selling for $5.30 at market close on Jan. 8. They have a 52-week low of $4 and a high of $5.53.
