Takeda Pharmaceutical Buys URL Pharma

Takeda Pharmaceutical Company, via its subsidiary Takeda America Holdings, is acquiring URL Pharma, a Philadelphia-based privately held pharma company. The deal includes an upfront payment of $800 million and future performance-based contingent earn out payments, the companies said in a statement.


Takeda Pharmaceutical Company Limited (Takeda) and URL Pharma Inc. (URL Pharma) jointly announced today that Takeda’s wholly-owned subsidiary, Takeda America Holdings, Inc. and URL Pharma have entered into a definitive agreement to acquire URL Pharma – a privately-held pharmaceutical company headquartered in Philadelphia, Pennsylvania, for an upfront payment of $800 million and future performance-based contingent earn out payments. Upon completion of the acquisition, URL Pharma will be managed by Takeda Pharmaceuticals U.S.A., Inc. The acquisition will contribute significantly to Takeda’s revenues, operating income, and free cash flow beginning in fiscal year (FY) 2013. Pending the satisfaction of customary closing conditions, the deal is expected to close within 60 days.


URL Pharma is a pharmaceutical company with 2011 calendar year revenues of nearly $600 million. Its leading product is Colcrys (colchicine) – used to treat and prevent gout flares. Net sales for Colcrys in calendar year 2011 were more than $430 million, and continued growth of Colcrys sales is expected through the product’s lifecycle.


“This acquisition expands Takeda’s gout treatment portfolio and leverages our expertise in primary care,” said Douglas Cole, president, Takeda Pharmaceuticals U.S.A., Inc. “Gout affects more than eight million Americans, and the prevalence of gout is rising. We are pleased to have URL Pharma’s Colcrys added to our product portfolio and look forward to further realizing our goal of helping patients by providing multiple treatment options to manage the symptoms of acute and chronic gout in the U.S.”


Colcrys complements Takeda’s position in the gout marketplace with Uloric (febuxostat), used to lower blood uric acid levels in adults with gout. The acquisition of URL Pharma strengthens Takeda’s offerings in the U.S. pharmaceutical market by providing patients with more gout management options to treat and prevent gout flares and the high uric acid levels associated with the condition.


“URL Pharma is pleased to become a part of a leading research-based global pharmaceutical company,” said Richard H. Roberts, M.D., Ph.D., Chief Executive Officer, and Chairman of the Board, URL Pharma.


Key Strategic Benefits


Takeda expects the acquisition of URL Pharma will:


Enhance Takeda’s gout treatment portfolio and allow it to provide multiple treatment options to patients and healthcare providers to manage acute and chronic gout in the U.S.


Contribute to revenues and non-GAAP operating income immediately, with estimated 2012 net sales of more than $550 million and expected continued growth of Colcrys sales through the product’s lifecycle.


Provide a strong, profitable and long-term source of revenue that complements Takeda’s core therapeutic areas in the U.S. business.


Fit within Takeda’s existing infrastructure.


Acquisition Summary


Acquiring company: Takeda America Holdings, Inc.


Shareholders of URL Pharma: Elliott Associates L.P., Momar Corporation and Dr. Richard H. Roberts


Payment: Cash


Number of common and preferred stock equivalent to common outstanding shares: 356,669


Acquisition amount: $800 million – The deal includes agreements stipulating Takeda will make future performance-based contingent earn out payments to URL Pharma’s current owners beginning in 2015. Other economic provisions are not disclosed.


Planned date of completion: Q1 FY2012


Financial advisor to Takeda: Goldman, Sachs & Co.


Legal advisor to Takeda: Sidley Austin, LLP


Financial advisor to URL Pharma: J.P. Morgan Securities LLC


Legal advisor to URL Pharma: Ropes & Gray LLP


Profile of URL Pharma, Inc.


Corporate Name: URL Pharma, Inc.


Location of executive offices: Philadelphia, Pennsylvania


Representative: Richard H. Roberts, M.D., Ph.D., President, CEO and Chairman


Year of establishment: 1946


Common Stock Equity: $1,000


Additional Paid-in Capital: $1,870,000 – Main shareholders are two venture capital investors, Elliott Associates L.P. and Momar Corporation, and Dr. Richard H. Roberts.


Shares: Non-listed


Number of employees: Approximately 500 employees. In addition, URL Pharma has a contracted sales force consisting of approximately 350 individuals.


Relationship with Takeda: No matters to report regarding capital, personal and transactional relationship between Takeda and URL Pharma.


The projected impact of this acquisition on Takeda’s consolidated financial statements will be reflected in Takeda’s fiscal 2012 outlook and Mid-Range Plan 2012-14, the outline of which will be announced on May 11, 2012.


About Colcrys


Colcrys (colchicine, USP) is a prescription medicine used in adults to prevent gout flares and treat gout flares when taken at the first sign of a flare.


Colcrys is not a pain medicine and it should not be taken to treat pain related to other conditions unless specifically prescribed for those conditions.


Important Safety Information


Colcrys can cause serious side effects or death if levels of Colcrys are too high in your body. Taking certain medicines with Colcrys can cause your level of Colcrys to be too high, especially if you have kidney or liver problems. Tell your healthcare provider about all your medical conditions and all the medicines you take, including prescription and non-prescription medicines, vitamins and herbal supplements. Fatal overdoses, both accidental and intentional, have been reported in adults and children who have ingested Colcrys. Keep Colcrys out of the reach of children. Colcrys can also cause serious muscle problems and blood disorders even when taken as directed. You have a higher chance for muscle problems if you are elderly, taking certain other medicines with Colcrys or have impaired kidney function. Tell your healthcare provider if you have any side effect that bothers you or that does not go away. The most common side effects in people who have gout flares are diarrhea and throat pain. For more information, refer to the patient Medication Guide. This information is not intended to replace discussions with a healthcare provider.


You are encouraged to report negative side effects of prescription drugs to the FDA.Visit www.fda.gov/medwatch or call 1-800-FDA-1088.You may also report negative side effects to the manufacturer of Colcrys by calling1.888.351.3786.


About Uloric


Uloric is a prescription medicine used to lower blood uric acid levels in adults with gout. Uloric is not for the treatment of high uric acid without a history of gout. Individual results may vary. Uloric® is a registered trademark of Teijin Pharma Limited and used under license by Takeda Pharmaceuticals U.S.A., Inc.