Firm will immediately sell on other assets to Royalty Pharma
Forest Laboratories has agreed to buy Furiex pharmaceuticals for $1.1 billion (£650 million) in cash, with a top-up of up to $360 million contingent on approval of Furiex’s irritable bowel syndrome drug eluxadoline.
The drug will mesh quite well with Forest’s other gastrointestinal drug lines, many of which came from its acquisition of Aptalis at the beginning of the year. True to the company’s focus on innovative drugs, Forest has also said that, as soon as the deal goes through, it will sell Furiex’s royalty rights to diabetes drug alogliptin and premature ejaculation remedy Priligy (dapoxetine) to investment firm Royalty Pharma.
There is an interesting twist to the approval contingency payment, too. Because eluxadoline is an opioid receptor agonist, there is a possibility that it will be classified as a controlled substance by the US Drug Enforcement Agency (DEA). If this happens, the value of the top-up payment will go down depending on the level of restriction the DEA imposes.