Salix Pharmaceuticals, Ltd.
) recently announced that it has completed its cquisition of
erstwhile Santarus, Inc.
The acquisition was completed following the completion of the
tender offer of common stock, par value $0.0001 per share of
Santarus, at a purchase price of $32.00 per share.
We note that the acquisition was announced in Nov 2013
concurrent with the third quarter results. The deal was valued at
approximately $2.6 million.
The acquisition will broaden Salix's product portfolio and
pipeline besides bolstering its position in the gastrointestinal
(GI) market. With the addition of marketed products like Uceris,
Glumetza and Zegerid to its portfolio, Salix's product offering
and revenue base will be diversified. Following the completion of
the acquisition, Salix's product portfolio comprises 22 marketed
products namely Xifaxan, Uceris, Glumetza, Zegerid, Apriso,
Moviprep, Relistor, Solesta, Deflux, among others.
In addition, Salix and Santarus entered into an agreement with
the latter's licensor Cosmo Technologies Ltd. The agreement
relates to the restructuring of certain aspects of Santarus'
partnership with Cosmo.
The Santarus acquisition is expected to be significantly
accretive in 2014. Additional synergies will lead to higher
earnings accretion in 2015.
We are positive on the Santarus acquisition. The acquisition
will also add a 100-member GI-focused sales force to Salix's
sales team. The new GI sales force will further strengthen
Salix's existing GI sales force of 200 members. The new sales
force will target endocrinologists, infectious disease, pain
specialists and high volume primary care physician prescribers,
which were formerly not accessed by Salix's GI-focused sales
Salix currently carries a Zacks Rank #2 (Buy). Companies that
look attractive at current include
Lannett Company, Inc.
). All three carry a Zacks Rank #2 (Buy).
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