Allergan pays $50 mln to buy privately-held Akarna Therapeutics

The announcement came several hours after Allergan revealed plans to acquire Tobira Therapeutics for $1.7 billion – another company with a lead compounds in NASH, including cenicriviroc (CVC), an oral immunomodulator aimed at inhibiting two chemokine receptors, and evogliptin, a DPP-4 inhibitor.

This is the latest in a string of deals orchestrated by Brent Saunders, Allergan’s chief executive and a seasoned dealmaker.

Allergan said in a statement that it will pay $50 million upfront for private biotech Akarna Therapeutics, with other milestone payments set to be added on top. Tobira shares were halted permarket for the news, while Allergan shares were not yet active.

The acquisition was completed at a price of $28.35, a 500% premium on Tobira’s closing price of $4.74 per share.

NASH, short for nonalcoholic fatty liver disease, is a type of liver disease in which liver fat builds up in people. In the Phase 2b CENTAUR study, CVC demonstrated a clinically and statistically significant improvement in fibrosis of at least one stage without worsening of NASH, one of two key secondary endpoints, after one year of treatment. NASH now affects 2 percent to 5 percent of Americans. Tobira TBRA, +725.71% holders also will each receive one contingent value right to receive as much as $49.84 a share linked to certain development and regulatory milestones.

Evogliptin is an oral inhibitor created to treat NASH that is now undergoing a Phase 1 trial assessing its safety and tolerability profile when used with and without CVC. It agreed on September 6 to pay US$60 million for RetroSense, a privately held company developing an ophthalmology gene therapy.

These are Allergan’s third and fourth acquisitions this month.

The deal sent shares of NASH-focused drugmakers soaring.

For the Tobira deal, Covington & Burling LLP was Allergan’s lead legal counsel. “Allergan appears to be buying biotech assets that the market views as “questionable” or relatively disappointing… and then paying large premiums to current market valuations”, wrote biotech analyst Michael Yee of RBC Capital Markets in a note to clients. Centerview Partners and Citi are Tobira’s financial advisers, while Skadden, Arps, Slate, Meagher & Flom LLP and Gunderson Dettmer Stough Villeneuve Franklin & Hachigian LLP are its legal counsel.