Shire boosts GI portfolio with Meritage acquisition
Shire will purchase the San Diego-based company for $70 million up front, with the potential for development and regulatory milestone payments
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LEXINGTON, Mass. & SAN DIEGO—Shire plc has announced the acquisition of privately held Meritage Pharma Inc., which specializes in developing prescription products for the treatment of gastrointestinal and atopic diseases, for $70 million up front as well as additional contingent payments based on development and regulatory milestones. With this deal, Shire gains the global rights to Oral Budesonide Suspension (OBS), Meritage's Phase 3-ready compound for the treatment of adolescents and adults with eosinophilic esophagitis (EoE), a rare, chronic inflammatory gastrointestinal disease. OBS has received Orphan Drug designation from the U.S. Food and Drug Administration for the treatment of patients with EoE.
“Meritage has worked closely with gastroenterologists, patients and their caregivers to develop Oral Budesonide Suspension, which was the first medication to significantly reduce eosinophilic inflammation and related symptom endpoints in patients with eosinophilic esophagitis in a Phase 2 clinical trial,” Dr. Elaine Phillips, Meritage’s president and CEO, said in a press release. “The acquisition of Meritage by Shire, a global biotechnology company with GI and rare disease expertise, may benefit physicians and patients by helping develop OBS to potentially become the first approved treatment in the U.S. indicated for this often disabling disease.”
Shire obtained the rights to acquire Meritage last year, in connection with its acquisition of ViroPharma. Shire closed the deal with ViroPharma in early 2014, announcing on Jan. 24 that it had successfully completed its tender offer for all outstanding shares of ViroPharma stock. Shire does not expect the Meritage transaction to affect its previously published earnings guidance for the year.
“Shire’s pipeline and strategic focus on rare diseases is further strengthened with the acquisition of Meritage, which also complements our strong GI capabilities. Adding this Phase 3-ready compound to our late-stage portfolio will allow us to leverage our expertise to further develop this important therapy that, if approved, will give hope to patients living with eosinophilic esophagitis,” Dr. Philip J. Vickers, head of Research and Development at Shire, commented in a statement.
It is estimated that approximately 181,000 children and adults suffer from EoE in the United States. The disease is characterized by inflammation and accumulation of eosinophil, a specific kind of immune cell, within the esophagus. EoE patients can face persistent or relapsing symptoms tied to esophageal dysfunction, including food impaction and dysphagia (difficulty swallowing).
This announcement comes just five days after Shire completed its tender offer for all outstanding share of NPS Pharmaceuticals Inc. and the acquisition of NPS Pharma. Shire's tender offer expired at midnight on Feb. 20, and at the expiration of the offer, approximately 88,869,118 common shares of NPS Pharma had been tendered to the offer, representing roughly 81.7 percent of NPS Pharma's outstanding shares. Shire completed the acquisition via a merger of one of its subsidiaries with and into NPS Pharma.
