With the IPO market sizzling and biotech valuations riding high, M&A in the sector hasn’t exactly run rampant this year. Even so, a few companies on the East Coast managed to pull out their checkbooks this week. We’ve got that and much more below:
—Lexington, MA-based Cubist pulled the rare biotech twofer this week, agreeing to buy two different antibiotics makers, San Diego-based Trius Therapeutics and Jersey City, NJ-based Optimer Pharmaceuticals, on the same day for a combined $1.24 billion. The deals, which will require approval from Trius’ and Optimer’s shareholders, would give Cubist one antibiotic already on the market and another that has passed all three clinical trials necessary for FDA approval.
—Summit, NJ-based Celgene (NASDAQ: [[ticker:CELG]]) has turned a seemingly innocuous $15 million investment in Acetylon Pharmaceuticals in early 2012 into a potential buyout. Celgene paid $100 million for an exclusive option to acquire the Cambridge, MA-based biotech for a one-time cash price of at least $500 million, though the actual number is based on a future independent valuation of the company. Celgene could also hand out up to $1.1 billion in milestone payments if Acetylon’s cancer drugs prove to be winners in clinical trials and in the market, bringing the total potential deal value to north of $1.7 billion.
—Watertown, MA-based Dicerna Pharmaceuticals got a big vote of confidence in its approach to RNA-based drugs as a group of investors poured $60 million in equity financing into the company via a Series C round. The investment was led by RA Capital, and included Deerfield, Omega Funds, and Brookside Capital—all new faces, and all better known for their investments in public companies. All five of Dicerna’s existing shareholders also contributed: Abingworth Management, Domain Associates, Oxford Bioscience Partners, Skyline Ventures, and SR One (the VC arm of GlaxoSmithKline).
—Cambridge-based Foundation Medicine has stepped into the IPO queue, giving diagnostics companies the chance to prove that the biotech IPO renaissance includes them as well. Foundation plans to raise as much as $86.25 million through its offering, and hopes to trade on the Nasdaq under the ticker symbol “FMI.” The company, backed by big names such as Bill Gates and Yuri Milner, uses new high-speed/low-cost gene sequencing technologies to create cancer diagnostics. While it’s garnered a ton of interest because of its approach, Foundation’s biggest challenge as a business, like many other diagnostics companies, will be to tackle the reimbursement problem.
—Cambridge-based Edimer Pharmaceuticals has secured an $18 million Series B round of equity financing and added a couple of big-name investors to boot. New Enterprise Associates led the round, and was joined by Sanofi-Genzyme BioVentures, the VC arm of rare disease giant Genzyme. Current shareholders Third Rock Ventuers and VI Partners also participated. Edimer is making a drug not only designed to fight an ultra-rare disease known as X-linked hypohidrotic ectodermal dysplasia, or XLHED, but beat it.
—Cambridge-based Sage Therapeutics’ identity shift towards edgier central nervous system orders paid as much as $10 million worth of dividends as the biotech landed a National Institutes of Health grant to help it move a treatment for the symptoms of Fragile X Syndrome, a rare form of autism, towards clinical trials.
—Shares of Cambridge-based Aegerion Pharmaceuticals (NASDAQ: [[ticker:AEGR]]) soared this week as investors cheered the latest results for its rare-disease drug, lomitapide (Juxtapid), which beat the company’s expectations. Aegerion hiked its projected revenue numbers for 2013 from between $15 million and $25 million to between $30 million and $35 million. Its stock has climbed close to 20 percent since releasing the numbers.
—Cambridge-based Vertex Pharmaceuticals (NASDAQ: [[ticker:VRTX]]) released new data from a late-stage clinical trial indicating that it might have the results necessary to expand the market for its cystic fibrosis drug, ivacaftor (Kalydeco), to include the roughly 400 patients worldwide who have at least one non-G551D gating mutation. Based on its data, Vertex plans to file applications to regulators in the U.S. and Europe in the second half of the year to approve the drug for those patients.
—New York-based Perrigo (NYSE: [[ticker:PRGO]]) finally ended the Elan (NASDAQ: [[ticker:ELN]]) saga by acquiring the company for $8.6 billion, or $16.50 per share, in cash and stock. The deal was a clear move by the generics giant to capitalize on Dublin-based Elan’s 12.5 percent Irish corporate tax rate. Several other recent pharmaceutical mergers, like Actavis’ (NYSE: [[ticker:ACT]]) buyout of Warner Chilcott (NASDAQ: [[ticker:WCRX]]) and Jazz Pharmaceuticals’ (NASDAQ: [[ticker:JAZZ]]) tie-up with Azur Pharma, were motivated by potential tax savings.
—New York-based Pfizer (NYSE: [[ticker:PFE]]), eschewing its megamerger history, took its latest step towards breaking up this week, announcing plans to split into three separate units. Pfizer has made a number of moves to slim down over the past few years, including spinning off its animal health unit, Zoetis (NYSE: [[ticker:ZTS]]), and selling its nutrition business to Nestle. The latest changes will be implemented in January 2014.
—Former Millennium Pharmaceuticals chief scientific officer and head of oncology research Joseph Bolen has joined Cambridge-based Moderna Therapeutics as its president of R&D. Bolen, who started his career as a scientist at the National Institutes of Heath, had been an executive at Millennium since 1999.
—Natick, MA-based cancer drug developer Karyopharm Therapeutics has added $19 million to the $48.2 million Series B round it first announced in May, giving a total of $67.2 million in fresh venture cash. The new $19 million investment was led by Foresite Capital Management, New Leaf Venture Partners, another unspecified “top-tier institutional investor,” and existing backer Delphi Ventures.
