|
 The deal is the latest sign that large pharmaceutical companies are
turning their attention back to antibiotics after decades of low
investment.
The spread of superbugs that evade even the most powerful
antibiotics threatens modern medicine, the World Health Organization
said in April, warning of "a post-antibiotic era" in which common
infections were killers once again.
The U.S. Centers for Disease Control and Prevention estimated last
year that more than 2 million people in the United States are
sickened every year by superbug infections, with at least 23,000
dying as a result. (http://1.usa.gov/1w5Hhml)
Merck said on Monday that the deal, which will give it access to
Cubist's antibiotic Cubicin, is expected to add more than $1 billion
to revenue in 2015 after closing in the first quarter, but will be
neutral to non-GAAP earnings per share until 2016.
Cubist's third-quarter sales rose 16 percent, driven by strong sales
of Cubicin.
Cubist may lose patent protection for Cubicin earlier than expected,
after a Friday federal court ruling that invalidated four of its
patents. If the ruling stands, it will allow Hospira Inc to launch a
generic version of the drug in 2016.
Merck could not immediately be reached for comment on the ruling.
Cubist's lead drug in development, Ceftolozane/Tazobactam, is widely
expected to win marketing approval from the U.S. Food and Drug
Administration later this month as a treatment for complicated
urinary tract infections.
Merck will pay $102 per share for Cubist, a premium of 37 percent to
the Lexington, Massachussetts-based company's closing share price of
$74.36 on Friday.
The deal includes assumption of $1.1 billion in debt.
"Cubist is a global leader in antibiotics and has built a strong
portfolio of both marketed and late-stage pipeline medicines," Merck
CEO Kenneth Frazier said in a statement.
"Combining this expertise with Merck's strong capabilities and
global reach will enable us to create a stronger position in
hospital acute care while addressing critical areas of unmet medical
need, such as antibiotic resistance."
[to top of second column] |
Merck has said it is focusing on acute care within hospitals -
considered a hotbed for superbug infections such as bacterial
pneumonia - as a top priority.
Many drugmakers have cut investment in the past because antibiotics
are typically low-priced and used for only short periods, generating
poor returns. That has fueled demands for a rethink of the
antibiotic market model.
It has also left Cubist as a leading investor in the field, with an
annual research budget for antibiotics of $400 million.
More recently, however, there have been signs of a revival, with
Roche Holding AG, GlaxoSmithKline Plc and Sanofi SA all investing in
new approaches to fight superbugs.
Cubist shares were trading at $101.04 premarket. Merck shares were
unchanged from Friday's close at $61.50.
The New York Times, citing people briefed on the matter, first
reported the deal on Friday.
The Cubist deal is Merck's second big acquisition this year. The
company bought Idenix Pharmaceuticals for $3.85 billion in June to
boost its hepatitis C drug portfolio.
[© 2014 Thomson Reuters. All rights
reserved.] Copyright 2014 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.
 |
