Pfizer Inc., the world’s largest drug manufacturer, has agreed to purchase emerging specialty pharmaceutical company NextWave Pharmaceuticals Inc. for $680 million as part of its strategy to focus on developing new drugs.
Specifically, NextWave manufactures an attention deficit hyperactivity disorder drug, called Quillivant XR.
During the second quarter of 2012, Pfizer entered into an option and merger agreement with NextWave. Now Pfizer is formalizing the purchase. At the close of the transaction, it will pay $255 million to NextWave shareholders, and up to $425 million more may be paid based on sales milestones for Quillivant XR.
The deal is expected to close during the fourth quarter. It will need to be approved by regulators first.
Pfizer has been selling off its nutritional and animal health businesses after CEO Ian Read changed the company’s focus to developing new prescription drugs.
Albert Bourla, president and general manager in Pfizer's Established Products Business Unit, says: "This agreement demonstrates our focused expansion of the Established Products US brands business to offer a diverse portfolio of high-quality medicines that meet patients' needs."
NextWave develops and markets products for the treatment of attention deficit hyperactivity disorder and related central-nervous-system disorders.
In September, the US Food and Drug Administration approved its drug Quillivant XR, which is the first once-daily liquid drug for ADHD approved by the FDA. The drug was developed in collaboration with Tris Pharma.
According to the Centers for Disease Control and Prevention, almost one in 10 children aged 4-17 in the US have been diagnosis with ADHD. The condition often lasts into adulthood and affects an estimated 4% of American adults.
Quillivant XR is expected to be available in US pharmacies in January 2013.
Key Statistics - World Pharmaceutical Industry (source: MarketLine)
- In 2010, the world pharmaceutical industry grew over 3.5% and reached $733 billion in value.
- It is forecast the world pharmaceutical industry will have a value of $981 billion in 2015, marking a 34% increase over 2010.
- Nearly 45% of world pharmaceutical industry value comes from the Americas.
- The leading player in the pharmaceutical industry globally is Pfizer, which generates nearly 9.5% of market value.