Biotech backs out of Canadian deal in favour of increased $2.6bn bid from Endo
US biotech Auxilium has backed out of a merger with Canadian firm QLT, in favour of a deal with US-based Endo. The cash-and-stock offer amounts to around $2.6 billion (£1.6 billion). Auxilium had initially turned down a lower offer from Endo in favour of proceeding with the QLT merger, but the improved offer convinced the company’s board to switch, even though it meant paying QLT a $28 million termination fee.
The deal is the latest of several Endo acquisitions, as the company follows its ‘lean operating model’ of growing through ‘selective acquisitions’ and focusing R&D efforts on ‘lower risk, near-term projects’. In the past year, Endo has acquired Paladin Labs, Boca Pharmacal and DAVA Pharmaceuticals in the US, Mexican firm Somar, and attempted to buy NuPathe, although this deal was scuppered by a competing bid from Israeli generics giant Teva. It has also divested its peripheral HealthTronics urology business and trimmed its workforce by 15%.