Today, Shire (Ireland) agreed to acquire ViroPharma (Exton, PA) for the tidy sum of $4.2 B -- a 27% premium on the latters share price and a multiple of 58x EBITDA. Wow, you say. Indeed.
Shire made the buy to gain control of ViroPharma's approved drug Cinryze to augments its own Firazyr for the treatment of hereditary angioedema. It alos makes shire less dependent on its big bread winner, Vyvanse for ADHD. This was Shire's 3rd acquistion of the year and its largest to date. In general, the market seems to accept the underlying strategy of building Shire's rare disease portfolio that will now command more than $2 B in annual revenues.
“With Cinryze, we will add another growth engine to our portfolio,” Ornskov, Shire CEO, said on a conference call, adding that the acquisition will help create a rare-disease business with $2 billion in annual sales. “It’s a deal that fits with our strategy of increased focus on high-growth specialty markets, particularly rare diseases.”
This is the big deal the market had been waiting for,” Savvas Neophytou, an analyst at Panmure Gordon & Co., said in a note to investors today. The purchase is “clearly at an eye-watering multiple but strategically very sound.” See Bloomberg and Pharma Times.
Posted by Bruce Lehr Nov 11, 2013