Zogenix (NASDAQ:ZGNX), a global biopharma corporation that develops and commercializes therapies for rare medical conditions and diseases,shoots up 60% after it announced UCB would acquire it for roughly $1.9 billion.
According to the definitive agreement, UCB will acquire all of Zogenix’s outstanding shares at a consideration of $26 per share in cash, plus a CVR (contingent value right) for a potential $2 cash payment, upon European Union approval, for the orphan medicine for treating Lennox-Gastaut Syndrome known as FINTEPLA.
Why is the deal beneficial?
This definitive agreement will both build and broaden the role UCB plays as a leader in addressing the unmet requirements of people battling rare and specific kinds of epilepsy. Not only has FINTEPLA been approved by the EMA (European Medicines Agency), but it also has FDA approval. In Japan, it’s going through a regulatory review.
Zogenix has also been trying to see if FINTEPLA can be used to treat seizures linked to additional rare epilepsies, like CDD (CDKL5 Deficiency Disorder) and LGS (Lennox-Gastaut syndrome). Zogenix has already engaged the EMA with its Type 2 Variation Application, and its sNDA (New Drug Application) has already been accepted by the FDA as well.
How does top management feel?
UCB’s Executive Vice President, Charl van Zyl, said:
The proposed acquisition of Zogenix reinforces UCB’s sustainable patient value strategy and continued commitment to addressing unmet needs of people living with epilepsy with an increasing focus on those living with specific or rare forms of epilepsy, where few options exist.
The EVP claimed that besides complementing its existing therapeutic offerings, acquiring Zogenix will provide them with an approved medication for treating life-threatening, childhood-onset, and rare-infant epilepsy linked with severe and frequent treatment-resistant seizures. Zogenix’s Chief Executive Officer and President, Stephen Pharr, Ph.D., said:
We are delighted to announce UCB’s proposed acquisition of Zogenix, recognizing the value of our lead medicine, both for the important role it has already begun to play for Dravet patients and their caregivers, and for its potential to help many others in the future.
The CEO claimed that they were excited about the potential of the future opportunities that this transaction brings. He says that working with UCB will help accelerate the progress and mission to enhance the care of people who need new treatments.