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news.PDL BioPharma has committed to an equity investment in Noden Pharma DAC, a new privately held company that has executed a purchase agreement with Novartis to acquire exclusive worldwide rights to manufacture, market, and sell the branded prescription medicine product sold under the name Tekturna and Tekturna HCT in the US and Rasilez and Rasilez HCT in the rest of the world.
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The product’s active ingredient is aliskiren, which is indicated for the treatment of hypertension. The drug was previously marketed by Novartis and had estimated global sales in 2015 of $154 million. The transactions are expected to close upon Hart-Scott-Rodino regulatory approval or expiration of the related waiting period.
PDL’s equity investment will ultimately result in an 88% equity interest in Noden. Given this anticipated majority ownership by PDL, the financial statements of Noden will be consolidated with PDL, which is expected to be immediately accretive to PDL’s cash earnings.
"PDL has completed many diverse deal structures for biotech/pharma companies looking to secure funding, and today’s announcement commits PDL to its first significant equity investment as part of an acquisition of a specialty pharmaceutical product," stated John P. McLaughlin, president and chief executive officer.
"We believe that the acquisition market for specialty pharmaceutical products is currently favorable and presents a meaningful growth opportunity for us. Tekturna has demonstrated strong results in treating hypertension and maintains a niche position in available hypertension treatment methods as the only approved direct renin inhibitor. We believe that, with additional, targeted promotion efforts, especially in the U.S., revenues of Tekturna could increase."
"We are pleased to be working again with Elie Farah, president and chief executive officer of Noden Pharma. PDL’s first financing transaction in 2012 was with Mr. Farah, in an acquisition of pharmaceutical products, while Mr. Farah was president and CEO of Merus Labs. That transaction resulted in a very nice return for the PDL shareholders," stated Mr. McLaughlin.
PDL expects to make equity contributions to Noden totaling approximately $107 million in the first year of the transaction, with an initial equity investment of $75 million to be made upon closing of the transaction, and an additional $32 million equity contribution commitment on the one-year anniversary of the closing of the transaction.
Noden is also expected to obtain debt financing in conjunction with the PDL equity investment. PDL may contribute additional amounts of equity depending on the amount of debt obtained by Noden, and as needed for specified milestone payments or other purposes. PDL will have three of the five seats on Noden’s board of directors.
About Tekturna
Tekturna, also known as Rasilez outside the U.S., is a high blood pressure medication. It is the only product available in a class of high blood pressure drugs called "direct renin inhibitors," which lowers blood pressure by blocking the enzyme renin.