Monday’s Biotech News: Valeant Pharmaceuticals Intl Inc (VRX), Repros Therapeutics Inc (RPRX)


Valeant Pharmaceuticals Intl Inc (NYSE:VRX) is putting more efforts to repay the term loan debt under its Senior Secured Credit Facility. This morning, the drug maker announced that certain affiliates of the Company have entered into an agreement to sell its Obagi Medical Products business for $190 million in cash to Haitong International Zhonghua Finance Acquisition Fund I, L.P. (the Fund). Limited partners of the Fund include industry veterans in other geographic markets, such as China Regenerative Medicine International Limited.

“The sale of Obagi marks additional progress in our efforts to streamline our operations and reduce debt,” Joseph C. Papa , chairman and CEO, Valeant. “As we continue to transform Valeant, we will remain focused on the core businesses that will drive high value for our shareholders.”

The Company currently estimates that the full-year 2017 revenue and Adjusted EBITDA (non-GAAP) for the Obagi business would have been approximately $85 million and $30 million , respectively.

The transaction is expected to close in the second half of 2017, subject to customary closing conditions, including receipt of applicable regulatory approvals.

According to TipRanks.com, 3 research analysts have rated the stock with a Sell rating, 9 research analysts have assigned a Hold rating and 3 research analysts have given a Buy rating to the stock. When considering if perhaps the stock is under or overvalued, the average price target is $19.00 which is 10.2% above where the stock closed last Friday.

Repros Therapeutics Inc (NASDAQ:RPRX) investors continue to dump shares after the biopharmaceutical received preliminary feedback from the FDA on the Company’s clinical development program for Proellex, its oral delivery mechanism for telapristone acetate.  The Proellex program will remain on partial clinical hold, and based upon the FDA’s review of all the existing liver function safety data, the FDA has indicated that the Company will be required to compile a large pre-approval safety data base to support future development.

Repros shares are currently trading at $0.305, down $0.274 or -47.31%.

Larry Dillaha, MD, Chief Executive Officer of Repros, said, “We are appreciative of the preliminary feedback received from the FDA and expect further clarification from the FDA in the coming weeks on our Proellex® development program.  Our discussions with the FDA, and their guidance that a large safety data base will be required to continue the development of Proellex®, indicate that a much larger clinical trial, with associated time and cost requirements, would be necessary.”

In light of the FDA guidance, the Company is assessing increasing its focus on its uterine fibroid and endometriosis development program utilizing a vaginal drug delivery program for telapristone acetate, a selective progesterone modulator (SPRM).  Dr. Dillaha commented, “We are encouraged by our clinical studies with our vaginal drug delivery program, which may provide the potential opportunity to differentiate our treatment from other orally-dosed compounds in development or on the market to treat uterine fibroids.  Clinical work done to date suggests that vaginal delivery of telapristone acetate has the potential to yield good efficacy with significantly lower systemic blood levels.  Furthermore, we intend to leverage drug delivery technology that could offer dosing less frequently than once per day.”