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Your Guide to Biotech M&A Monday

Some biopharma business development teams had a sleepless weekend. Four healthcare-related acquisitions were announced in quick succession on Monday morning, totaling about $18 billion in value. A handful of early collaborations made headlines as well.

The acquisitions are sure to stoke the “biotech bubble” debate that pervaded financial media last week. Bulls will point to pharma’s apparent appetite for acquisitions even at the sector’s relatively high valuation, while Bears will suggest that this is last-minute FOMO and that the fundamentals will catch up with the sector in due time. Either way it’s a sea of green in healthcare at the open.

Horizon Pharma PLC (NASDAQ:HZNP) will acquire Hyperion Therapetics Inc (NASDAQ:HPTX) for $46/share, or $1.1 billion in cash. The deal represents a 35% premium to Hyperion’s volume-weighted average price for the trailing 60-days according to Horizon’s press release, but HTPX closed last Friday at $45.

Israeli pharma giant Teva Pharmaceutical Industries Ltd (ADR) (NYSE:TEVA) is folding in Auspex Pharmaceuticals Inc (NASDAQ:ASPX) at $3.5 billion for access to Auspex’s SD-809, a deuterized tetrabenazine being developed for the potential treatment of chorea associated with Huntington’s disease, tardive dyskinesia, and Tourette syndrome. The deal is all-cash.

UnitedHealth Group Inc’s (NYSE:UNH) pharmacy care services business OptumRx agreed to buy the pharmacy benefit manager Catamaran Corp (USA) (NASDAQ:CTRX) in a deal worth about $12.8 billion. UNH will pay $61.50 per share for a premium of 27% from Friday’s close. The deal will be financed with existing cash and new debt. Catamaran emerged from the merger of SXC Health Solutions and PBM Catalyst Health Solutions three years ago.

Fujifilm will acquire Cellular Dynamics International Inc (NASDAQ:ICEL) for a 100% premium to Friday’s close, $307 million. ICEL produces functional human cells for drug discovery, screening, and early safety/efficacy testing. The smaller company had $17 million in revenue last year.

Intrexon Corp (NYSE:XON) and ZIOPHARM Oncology Inc (NASDAQ:ZIOP) will collaborate with Merck KgaA on new chimeric antigen receptor T-cell (CAR-T) products for the larger pharma company. Intrexon will receive an upfront payment of $115 million for development of two initial targets selected by Merck KGaA. Intrexon is eligible to $826 million in development, regulatory and commercial milestones, as well as tiered royalties on potential product sales. Frankly, the $115 million up front is impressive for non-existent products.

Still-private but going-public Aduro Biotech received $200 million up front from Novartis AG (ADR) (NYSE:NVS) for the discovery of cyclic dinucleotide (CDN) immunotherapies targeting the STING (Stimulator of Interferon Genes) pathway. Novartis also made an initial equity investment in Aduro of $25 million, with a commitment for another $25 million at a future date. Aduro is eligible for $750 million in milestones, plus profit sharing from successful products.

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