The onslaught of health care and pharmaceutical deals continued Monday with Forest Laboratories agreeing to pay as much as $1.46 billion for Furiex Pharmaceuticals.
As we reported last week, the health care and pharmaceutical industries have been ripe for transactions, creating a glut of deal work for M&A lawyers. Zimmer Holdings announced Thursday that it agreed to acquire rival medical device specialist Biomet Inc. in a deal worth $13.35 billion. That was followed by Valeant Pharmaceuticals’ $45.7 billion hostile bid for Botox maker Allergan as well as a series of multibillion-dollar transactions between Swiss pharmaceutical giant and rivals GlaxoSmithKline and Eli Lilly.
New York–based Forest, which itself was sold to Irish generic drug maker Actavis for $25 billion in February, is paying $95 in cash for each share of Morrisville, N.C.–based Furiex, for a total of $1.1 billion. Forest has also agreed to fork over up to roughly $360 million in contingent value rights based on the pending regulatory approval of Furiex’s top product, irritable bowel syndrome treatment eluxadoline. Actavis has given the Furiex deal its stamp of approval, saying that the purchase will not affect its own deal with Forest, which is still expected to close in the middle of this year.
Forest said the purchase further bolsters its gastroenterological offerings, which it previously expanded with the January acquisition of Aptalis Pharma from TPG Capital for $2.9 billion. In addition to the Furiex purchase, Forest also said it has agreed to sell Furiex’s royalties on two of its products—diabetes treatment alogliptin and Priligy, which aims to prevent premature ejaculation—to Royalty Pharma for $415 million. That deal would take place after Forest closes its acquisition of Furiex, which is expected to occur no later than this year’s third quarter, pending approval by regulators as well as Furiex shareholders.
Covington & Burling is representing Forest on the purchase, while Latham & Watkins is advising Actavis. (Latham also advised Actavis on its acquisition of Forest, which was represented in that deal by Wachtell, Lipton, Rosen & Katz.) Covington previously advised Forest on its 2011 purchase of Clinical Data Inc. for $1.2 billion.
New York–based corporate partner Andrew Ment is leading a Covington team that also includes employee benefits partner Michael Francese, IP partner Lee Tiedrich, tax partner Rob Heller and corporate special counsel Sarah Hoagland, as well as food and drug regulatory partners Michael Labson and Peter Safir. A. Robert Bailey serves as Forest’s general counsel.
Weil, Gotshal & Manges is serving as Forest’s antitrust counsel on the deal, led by Washington, D.C.–based partners Steven Newborn, Ann Malester and Steven Bernstein, as well as counsel John Sipple and associate Daniel Antalics.
Latham’s team on Monday’s deal includes Orange County–based corporate partners R. Scott Shean and Charles Ruck, along with corporate counsel David Wheeler and David Kuiper, as well as associate Jeffrey Holgate.
Furiex is being represented by attorneys at Kirkland & Ellis as well as Raleigh-based firm Wyrick Robbins Yates & Ponton. Kirkland’s team is led by New York–based corporate partners Richard Brand and Stephen Fraidin. Kirkland associates on the deal are Willard Boothby, Solomon Eskinazi, Lauren Rakower and Benjamin Ritzo. Fried, Frank, Harris, Shriver & Jacobson corporate partner Philip Richter is representing Bank of America Merrill Lynch in its role as financial adviser to Furiex.
Goodwin Procter is advising Royalty Pharma on its separate agreement with Forest. Boston-based corporate partner John Haggerty and San Francisco–based life sciences partner Karen Spindler are leading the firm’s team, which also includes associates Sean Doran and Crystal Kaldjob.