British Biotech to acquire Vernalis for £48m
Biopharma group Vernalis plc based near Reading, UK has agreed to a £48 million (€69.7m; $80m) acquisition by its Oxford-based rival British Biotech.
The takeover will create a group with a combined value of about £91 million (€132m; $152m).
The merged group is to be called Vernalis with its headquarters in Winnersh near Reading, UK.
The deal, expected to be completed by September 2003, would mean cutting jobs in the combined workforce in the Thames Valley and Oxford region from around 204 to 130 in order to make synergy savings of £6.5 million (€9.5m; $10.9m) within the first year.
British Biotech is offering Vernalis shareholders 0.861 new shares for every Vernalis share, valuing the Vernalis shares at 55p.
The move comes amid further consolidation in the biotech sector. The merged group will have R&D facilities in both Winnersh and Cambridge, UK.
The proposed merger has the unanimous support of the boards of both British Biotech and Vernalis in offering superior growth opportunities while creating extra value from the potential of frovatriptan, its product for the acute treatment of migraine, which is marketed in both the US and Europe.
In addition to frovatriptan, the new group will have a strong pipeline of three products in Phase II, two in Phase I, two in pre-clinical development and a broad range of discovery programmes in late-stage research.
The focus of the group’s R&D will be in CNS disorders and oncology. There are collaborations already in place with Roche in obesity, with Lilly in sexual dysfunction and with Serono in inflammation.
Since joining the Board of British Biotech as Chairman, Dr Peter Fellner has negotiated the acquisition of privately-owned RiboTargets, located in Cambridge, UK for £26m.
In a parallel move, in March 2003, British Biotech transferred its research operations to contract research house, Evotec OAI in Oxford. The deal involved transfer of 17 British Biotech scientists plus equipment to support the ongoing anti-inflammatory and anti-infectives discovery programme.
In May 2003, British Biotech set up a collaboration with Singapore-based MerLion Pharmaceuticals to discover and develop novel anti-bacterial drugs by targeting ribosomes. The deal capitalises on crystallography expertise and NMR technology British Biotech acquired with the RiboTargets merger.
Keywords : Vernalis Group British Biotech UK M&A Merger Acquisition Biopharmaceuticals RiboTargets Cambridge Outsourcing CRO Oxford OAI Collaborations Roche Lilly Serono MerLion Pharmacuticals Singapore
