Horizon Pharma Acquisition Expands Rare Disease Business

Horizon Pharma Plc announced they have entered a definitive agreement with Raptor Pharmaceutical Corporation to further their commitment to rare disease treatment and research, according to a company press release.

Raptor is a California-based biopharmaceutical company that develops and commercializes drugs for rare diseases, often called orphan diseases. Raptor’s net revenue for 2015 was $125 to $135 million.

Under the terms of the agreement, Horizon will acquire shares of Raptor, with a diluted equity value of $800 million, according to a press release.

“The proposed acquisition of Raptor furthers our commitment to helping people with rare diseases and is a significant step in advancing our strategy to expand our rare disease business,” said Timothy P. Walbert, chairman, president and chief executive officer, Horizon Pharma plc. “Along with the potential for accelerated revenue growth, the addition of Raptor strengthens our US orphan business and provides a platform to expand our orphan business in Europe and other key international markets. We look forward to working with new patient communities and building on the success of the Raptor team.”

This acquisition also adds Procysbi delayed-release capsules and Quinsair to their portfolio, 2 drugs that treat rare diseases. Procysbi is a cysteine-depleting agent that received FDA-approval for the treatment of nephropathic cystinosis, a rare metabolic disorder.

The drug has also received approval as an orphan drug by the European Commission for this disorder. Quinsair is a proprietary inhaled formulation of levofloxacin, and has been approved in the European Union and Canada for managing chronic lung infections due to Pseudomonas aeruginosa in patients with cystic fibrosis, according to Horizon.

Raptor also has several drugs in the development and clinical trial stages for rare diseases, such as Huntington’s disease and mitochondrial diseases. The acquisition will diversify revenue through new drug additions to orphan, rheumatology, and primary care business units.

Approximately 45% of Horizon’s revenue in the first half of 2016 came from rare diseases, and is expected to increase even further through this acquisition.

“This transaction will deliver significant and immediate value to our shareholders through a compelling all-cash premium and provide ongoing value to our patients, their families and the physicians who treat them,” said Julie Anne Smith, president and chief executive officer, Raptor Pharmaceutical Corp. “On behalf of the Board and management team, I extend our deepest gratitude to everyone at Raptor for their unrelenting commitment to advancing the development of our medicines and their tireless work with the patients we serve.”