Sunovion Targets Respiratory Drug in $430M Deal for Elevation Pharma

[Updated throughout 8/30/12 2:00 pm.] Sticking with a lean business model has paid off big for San Diego’s Elevation Pharmaceuticals, which has agreed to a buyout offer from Marlborough, MA-based Sunovion Pharmaceuticals that could eventually be worth as much as $430 million.

With the deal, Sunovion (a subsidiary of the Japanese drug maker Dainippon Sumitomo) has secured EP-101, an inhaled medication to ease the breathing of patients with respiratory disease. The  drug is a reformulated and inhalable solution of a generic drug already approved by the FDA—a long-acting muscarinic antagonist (LAMA) bronchodilator. Elevation combined the drug with its eFlow Nebulizer System, a proprietary, hand-held device used to deliver an easy-to-inhale mist.

Elevation was advancing the drug-and-device together, and recently completed a mid-stage trial for treatment of chronic obstructive pulmonary disease (COPD). Elevation’s nebulizer represents a key part of  the value of the deal for Sunovion (previously known as Sepracor), which can combine the device with other respiratory drugs already in its portfolio.

Elevation was founded in 2008, and has raised a total of $44 million to develop new aerosol therapies with a team of just 11 employees. The principal founder, CEO Bill Gerhart, was joined by chief medical officer Ahmet Tutuncu and San Diego serial entrepreneur Cam Garner, who served as chairman.

In a telephone interview this afternoon, Gerhart said Sunovion’s offer represents his best

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Author: Bruce V. Bigelow

In Memoriam: Our dear friend Bruce V. Bigelow passed away on June 29, 2018. He was the editor of Xconomy San Diego from 2008 to 2018. Read more about his life and work here. Bruce Bigelow joined Xconomy from the business desk of the San Diego Union-Tribune. He was a member of the team of reporters who were awarded the 2006 Pulitzer Prize in National Reporting for uncovering bribes paid to San Diego Republican Rep. Randy “Duke” Cunningham in exchange for special legislation earmarks. He also shared a 2006 award for enterprise reporting from the Society of Business Editors and Writers for “In Harm’s Way,” an article about the extraordinary casualty rate among employees working in Iraq for San Diego’s Titan Corp. He has written extensively about the 2002 corporate accounting scandal at software goliath Peregrine Systems. He also was a Gerald Loeb Award finalist and National Headline Award winner for “The Toymaker,” a 14-part chronicle of a San Diego start-up company. He takes special satisfaction, though, that the series was included in the library for nonfiction narrative journalism at the Nieman Foundation for Journalism at Harvard University. Bigelow graduated from U.C. Berkeley in 1977 with a degree in English Literature and from the Columbia University Graduate School of Journalism in 1979. Before joining the Union-Tribune in 1990, he worked for the Associated Press in Los Angeles and The Kansas City Times.