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Forest swallows Clinical Data in $1.2 billion buyout

Posted on 23 February 2011

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Only weeks after Clinical Data obtained approval for a new antidepressant, Forest has acquired the company in a deal worth $1.2 billion.

In the deal, Forest are paying $30 per share plus an additional $6 per share contingent upon achievement of certain commercial milestones related to Viibryd.

The upfront payment represents a 6.6 premium over current trading. With the milestone payment, the premium increases to 19.2%.

Forest's price reflects its interest in Viibryd, the newly approved antidepressant that is making a claim that it is safer and triggers fewer sexual side effects than other SSRI drugs now on the market. The drug is being touted as the "first and only" antidepressant to combine an SSRI and a serotonin 1a receptor partial agonist in one molecule.

Forest will finance the transaction with existing cash.

See deal record at Current Agreeements | 2011 M&A Scorecard

The transaction was approved by the boards of both companies and is expected to be completed in the second quarter of 2011, subject to customary closing conditions.

The transaction is the second in a week to use contingent payments as a way for an acquiring company to mitigate the risk of an asset failing to perform as expected.

Steve Poile


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