Insight journal - Deals and alliances

Dealmakers weekly review – February 13 2012 – Eli Lilly, Roche, UCB, Janssen, Sistemix, TiGenics, Becton Dickinson, SDIX, Aldagen, Carefusion

Posted on 14 February 2012

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The news in the past week has been the lack of deal news. The past week has been very quiet on the dealmaking front, with very little of significance in terms of deals from bigpharma or deals with a high headline value.

Despite the low level of high headline activity, there have still been 54 deal announcements, with smaller companies and deals with low of no financial detail.

As a result, this weeks review gives the smaller companies a look in.

The review

Bigpharma has been very quiet on the dealmaking front in the past week. Of course there has been alot of news about bigpharma recently, primarily on the jobs front with many announcing significant redundancies for 2012. Bigparma have also been lining up to state they won't be competing with Roche for the rights to Illumina meaning that Roche will be the lone bidder in what looks liek a drawn out affair.

The deals announced by bigphamra include Eli Lilly's licensing agreements with Bend Research for spray-dried dispersion technology, Janssen Pharmaceutical's supply agreement with Watson for ortho tri-cyclin, Roche's animal disease resistance collaboration with the Smithsonian National Zoo, and UCB's collaborative R&D agreement with Nodaility for research into immunology disorders.

M&A activity also continues to be sluggish after a fast start to the year. It appears that many companies are pausing for breath in order to assess the economic mood before progressing with M&A activities. However, I expect M&A activity to be a major story of 2012 unless there is a significant deterioration in global outlook, in whcih case all bets are off.

There has been a significant amount of grant activity with 9 grant agreements announced during the week, wuth the National Cancer Institute and The Marta and Owen Boris Foundation particularly active.

The numbers

Partnering deals: 54 (down on last week: 63)

M&A deals: 8 (up on last week: 5)

Financing deals: 19 (same as last week: 19)

Deals of note

1. Collaborative R&D agreement for REGENER-AR project

Headline value: $7.8 million

Sistemic, TiGenix - Inflammatory > Rheumatoid arthritis - Preclinical

Sistemic announced that its proprietary technology has been chosen to form a key part of the research and production process for a landmark multinational collaborative project led by TiGenix, Belgium and including partners from Spain, France, the Netherlands as well as the UK and Belgium.

The project, REGENER-AR, will bring the first stem cell therapy treatment product for rheumatoid arthritis, Cx611, through final research and clinical development.

The proprietary SistemQC miRNA-based stem cell characterization and quality control tool-kit will provide important insights into process optimization and QC testing of TiGenix’s pioneering cell therapy product.

2. Collaborative R&D agreement for microscopic detection solutions

Headline value: $3.75 million

Becton Dickinson Diagnostics, SDIX - Diagnostics

SDIX and BD Diagnostics announced the signing of a comprehensive agreement whereby the two companies will collaborate in the development of a microbiology detection solution.

The collaboration will combine SDIX’s expertise in development of high performance antibodies with BD’s expertise in diagnostic system development.

3. Acquisition agreement for Aldagen

Headline value: $40 million

Cytomedix, Aldagen

Cytomedix announces the completion of the acquisition of Aldagen.

Under the terms of the transaction as described below, Cytomedix issued preferred shares valued at $16 million based on a 10-day volume-weighted average price (“VWAP”) calculated through February 2, 2012.

Cytomedix will issue additional consideration to be paid in common stock upon the successful attainment of several clinical milestones.

As part of the transaction, certain Aldagen investors purchased $5.0 million of Cytomedix common stock in a private placement concurrent with the closing of this acquisition.

4. Common stock repurchase for $500 million

Headline value: $500 million

Carefusion

CareFusion announced that its board of directors authorized the repurchase of up to $500 million of the company's common stock.

The program authorizes the company to repurchase shares of its common stock through open market and private transactions.

Dealtalk

Alongside partnering and M&A announcements, there is a slew of rumours and discussions about who might be partnering with whom – here is a selection of the stories from the past week:

Roche, Glencore spark hope of European M&A revival

Watson sets aside $6 billion to buy brand-name drug assets

Big VC biotech spending on the rise for 2012

Nestle leads pack of bidders for Pfizer nutrition unit

Nervous GlaxoSmithKline pulls cash out of Eurozone to avoid crisis

Boston Scientific saving cash for possible acquisitions, CFO Capello says

Steve Poile

 

Related links:

View all deals of the past week at Current Agreements (subscription required)

Subscribe to Current Agreements for access to every deal since 2000.

Use the promotion code CA200212 before end February 2012 and receive a $600 discount off an annual subscription.

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