Replies to post #148109 on Biotech Values

[zipjet]

The transaction, which values Medicis' common stock at approximately $2.6 billion

That is quite a price for VRX which already has over $7B in debt (net of cash) and will have to borrow most if not all of the $2.6B.

ij

[DewDiligence]

MRX is a well-run company with some desirable assets in its portfolio. I’ve followed MRX closely because it’s one of AGN’s main competitors, and I’ve always thought MRX had an ample amount of buyout vig. However, MRX is one of the least transparent drug/biotech companies I know, so it’s been a hard company to place a value on without the inside look a prospective acquirer can get via a non-disclosure agreement.

MRX’s decision to sell now may be influenced, at least in part, by CEO Jonah Shacknai’s personal tragedy last year.

[DewDiligence]

Quiz: The previous time a company attempted to acquire MRX, it not only failed to do so, but also was itself acquired by a third party. Who was the spurned suitor for MRX?

[DewDiligence]

VRX sells aesthetic-medicine products to Nestlé for $1.4B:

http://online.wsj.com/news/articles/SB10001424052702303633604579589253541183382

In a statement Wednesday, Vevey-based Nestlé said it was acquiring the U.S. and Canadian commercial rights to five aesthetic dermatology products owned by Valeant. Nestlé had previously sold the brands outside of North America.

The products covered by the deal include Restylane, Perlane and Emervel, which are used to fill wrinkles and increase the fullness of lips. The deal also covers Dysport and Sculptra, which are used to remove smile lines, as well as other medical and aesthetic treatments.

This is (IMO) a preemptive move related to VRX’s offer to acquire AGN insofar as VRX would have to divest these products for anticompetitive reasons if it were successful at acquiring AGN. Dysport is a Botox-like botulinum toxin that VRX picked up in the 2012 acquisition of Medicis (#msg-79186818), and Restylane/Perlane are dermal filers (similar to AGN’s Juvederm) that also came from Medicis.

[DewDiligence]

AGN’s CEO David Pyott didn’t miss an opportunity to blast VRX on today's CC by noting that the Restylane/Perlane/Sculptra franchise of dermal fillers has stabilized after VRX sold it to Nestle/Galderma (#msg-102583917) after it had steadily lost market share while owned by VRX.