OSI Pharmaceuticals and Eyetech sign merger
Biotechnology company OSI Pharmaceuticals has entered into a definitive merger agreement with Eyetech Pharmaceuticals, a biopharmaceutical company that focuses on the development and commercialisation of novel therapeutics to treat eye diseases.
Biotechnology company OSI Pharmaceuticals has entered into a definitive merger agreement with Eyetech Pharmaceuticals, a biopharmaceutical company that focuses on the development and commercialisation of novel therapeutics to treat eye diseases.
Under the terms of the agreement OSI will acquire all outstanding shares of Eyetech common stock at a price of US$20 per share in a combination of cash and OSI common stock, for an aggregate purchase price of approximately US$935m, representing a 43% premium over Eyetech's $13.99 closing share price on 19 August. 75% of the purchase price is to be paid in cash, with the remaining 25% to be paid in OSI common stock using an exchange ratio of 0.12275 OSI shares for each share of Eyetech.
The acquisition is subject to a number of closing conditions, including Eyetech stockholder approval and regulatory approvals. The parties expect to close the transaction by the end of 2005.
'The combination of OSI and Eyetech will create a biopharmaceutical company with over US$600m of projected revenues in 2006 and strong growth prospects for the future,' said Colin Goddard PhD, ceo OSI. 'We believe the proposed transaction will deliver scale to OSI's current business, bring forward profitability and provide for double-digit revenue growth over the next five years. We anticipate that OSI will be a profitable enterprise with business units in the commercial arenas of oncology, eye diseases and diabetes; and possess a pipeline of high quality drug candidates'.
The combined company will have two marketed products for the treatment of cancer and age-related macular degeneration, and a product pipeline offering both new indications for the marketed products and novel therapeutics in all three disease areas. Tarceva, approved in the US for advanced NSCLC, is the first EGFR inhibitor to demonstrate improved survival in both non-small cell lung cancer (NSCLC) and pancreatic cancer; Macugen is a novel first in class therapeutic that selectively binds to the pathological isoform of Vascular Endothelial Growth Factor (VEGF) to treat all forms of neovascular AMD including occult, minimally classic and predominantly classic lesion sub-types. The company expects both to be launched in the EU by early 2006.