Forest Laboratories, Furiex Pharmaceuticals, Royalty Pharma deal

Forest will acquire Furiex for $95 per share in cash, or about $1.1 billion, plus a contingent value right (CVR) worth up to $30 per share, or up to $360 million, tied to approval and scheduling by the U.S. Drug Enforcement Agency of Furiex's eluxadoline. The $95 price is a 19% premium to Furiex's close of $80.15 on April 25, before the deal was announced. Next quarter, Furiex plans to submit an NDA for the locally acting mu opioid receptor agonist and delta opioid receptor antagonist to treat diarrhea-predominant irritable bowel syndrome (IBS-D). If the product is approved by FDA and is not scheduled as a controlled drug by the DEA, holders of the CVR will receive $30 per share, or about $360 million. Holders of the CVR will receive $10 if eluxadoline is designated as a class IV scheduled drug or $20 per share if it is designated as a class V scheduled drug. Furiex reported 2013 revenues of $71 million, and Forest reported $3.6 billion in revenues for the 12 months ending March 31.

Forest said eluxadoline will complement its gastrointestinal portfolio, which includes Linzess linaclotide. Forest and Ironwood Pharmaceuticals Inc. (NASDAQ:IRWD, Cambridge, Mass.) market the drug in the U.S. to treat irritable bowel syndrome with constipation (IBS-C) and chronic idiopathic constipation (CIC). Forest has U.S. rights to the guanylate cyclase C ( GCC; GUCY2C) agonist from Ironwood under a 2007 deal. ...