Vanda rejects buyout offers, pans 'opportunistic attempts' at securing its shares at a discount
20 Jun 2024
Acquisition
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Source: FiercePharma
Vanda has rejected multiple buyout proposals and is proceeding with its prior plans, the company said in a statement.
A series of increasing buyout offers has failed to convince Vanda's board of directors that the company should sell itself.
After receiving "unsolicited" buyout proposals from Michigan-based CDMO Future Pak and U.K. drugmaker Cycle Pharmaceuticals, Vanda's board concluded that both offers "substantially undervalue" the company. Vanda has rejected the proposals, the company said in a June 19 press release.
Starting in February, Future Pak began submitting a series of proposals to acquire Vanda. In April, Future Pak revealed that it was willing to buy Vanda for $7.25 to $7.75 per share. The following month, Future Pak boosted its offer by floating contingent value rights worth up to $260 million tied to specific future commercial and regulatory accomplishments by Vanda.
Early this month, Cycle Pharma got involved with a buyout offer of $8 per share, or $466 million in total. At the time, Vanda said it would "carefully review and evaluate the indication of interest" in the proposal.
Now, Vanda is turning back both offers in favor of proceeding with its own plan.
"The Vanda board again evaluated all aspects of Vanda's business against the unsolicited proposals and determined that the proposals are opportunistic attempts to purchase the company's shares at a discount to Vanda's intrinsic value," Vanda said in a statement. "The board's prior analysis of the company's clinical development pipeline, expanding commercial presence and significant cash balance remains unchanged."
Vanda said its revenue base, cash position and efficient operations position the company "for significant long-term growth and value creation far in excess of the" other firms' offers.
Vanda generated $192 million in 2023, a 24% decrease from the prior year as sleep disorder drug Hetlioz posted sharply lower sales thanks to U.S. generic competition.
Seeking to regroup for a new phase of growth, Vanda recently acquired Ponvory, a former Johnson & Johnson multiple sclerosis drug, for $100 million. And its schizophrenia stalwart Fanapt won an expanded label to treat bipolar I disorder.
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