Bristol-Myers Squibb to pay as much as $475 million for Amira
SAN DIEGO—Under the terms of a deal struck late last week, Bristol-Myers Squibb Co. (BMS) will acquire all of the issued and outstanding shares of capital stock and stock equivalents of closely held Amira Pharmaceuticals Inc.—a small-molecule pharmaceutical company focused on the discovery and early development of drugs to treat inflammatory and fibrotic diseases—in an all-cash transaction of $325 million.
For BMS, a key payoff is securing Amira Pharmaceuticals' fibrosis program for itself, and bringing into it own fold the lead asset of Amira: AM152, an orally available lysophosphatidic acid 1 (LPA1) receptor antagonist which has completed Phase I clinical studies and is now poised for Phase IIa proof-of-confidence studies for the treatment of idiopathic pulmonary fibrosis (IPF) and systemic sclerosis (SSc), or scleroderma.
Pulmonary fibrosis is a disease that damages and scars the lungs and makes breathing very difficult, and it gained most of it notoriety in the public consciousness for having a high rate of incidence among early responders to the 9/11 terrorist attacks in New York. The disease kills some 40,000 people a year, so it's not a gigantic patient population, but Amira has noted that it is a "grievous illness" so it is considered by many to be a good market opportunity for the first company to come up with an effective treatment.
"As part of the continued execution of our focused BioPharma strategy, Bristol-Myers Squibb has identified fibrotic diseases as an area of high unmet medical need that complements our research efforts in several of our therapeutic areas," says Elliott Sigal, executive vice president, chief scientific officer and president of research and development for BMS. "The acquisition of Amira Pharmaceuticals represents the latest example of our 'String of Pearls' strategy, a highly targeted set of transactions designed to enrich our innovative pipeline with potential medicines to help patients in need."
"Amira Pharmaceuticals' scientists have been leaders in the research and development of lysophosphatidic acid receptor antagonists for fibrosis," notes Dr. Jeremy Levin, senior vice president of the Strategic Transactions Group within BMS. "We compliment the professional approach of the investors and Amira Pharmaceuticals' leadership and scientific team who, since 2005, have built a highly innovative company. We will now build on that history and commitment to innovation to discover and develop novel medicines in this important disease area."
In addition to the LPA1 receptor antagonist, BMS will gain Amira's autotaxin program, currently in the preclinical stage. This area is seen to be potentially useful in developing therapies for neuropathic pain and cancer metastases.
BMS has previously noted that plans to introduce five new drugs by 2012, including treatments for cancer, diabetes and heart disease to offset the expected hit when Plavix, its top-selling drug, loses patent protection next year.
In addition to the upfront payment, BMS reports that potential additional milestone payments of as much as $150 million may come into play, bringing the total price to as much as $475 million. While that appeals to Amira shareholders and management, of course, what is probably more comforting to many working at the company is that BMS has said it plans to retain Amira's scientists who work on both programs and will keep them in San Diego. In November 2010, Amira laid off about half its staff—a total of 25 cuts—to slow its burn rate. Those cuts even included three co-founders of the company: Chief Scientific Officer Peppi Prasit, Vice President of Biology Jilly Evans and Vice President of Chemistry John Hutchinson.
Bob Baltera, CEO of Amira, says he is pleased about the acquisition and adds: "Our LPA and autotaxin programs are world leading and will be in excellent hands."