Valeant Pharmaceuticals International, Inc. has announced today a deal to acquire OraPharma, a specialty oral health company.
The transaction is Valeant’s fifth of 2012, after the purchase of the over-the-counter product AcneFree from University Medical Pharmaceuticals and the purchases of Swiss Herbal Remedies, a nutraceutical firm, US podiatry firm Pedinol Pharmacal, as well as assets from Mexico’s Atlantis.
OraPharma has been acquired from Water Street Healthcare Partners, a private equity firm focused exclusively on the health care industry.
The total consideration for the deal is approximately $312m and could rise by $114m, pending potential contingent payments based on certain milestones, including revenue targets.
OraPharma’s lead product is Arestin, an antibiotic for the treatment of periodontitis which utilises an advanced controlled-release delivery system and is indicated for use in conjunction with scaling and root planing, for the treatment of adult periodontitis.
According to the company release, OraPharma has the largest specialised pharmaceutical sales force within the dental industry.
As of 31st March, 2012, OraPharma’s trailing twelve month net revenue was approximately $95m, with the business growing at a high single digit rate.
J. Michael Pearson, Valeant chairman and chief executive officer, said that the company is excited to enter a new attractive market segment, with an already established sales infrastructure focused entirely on the dental community.
"We believe that this market segment has similar characteristics to the dermatology, podiatry and ophthalmology markets and should offer us the opportunity to cross-sell some of our current products, most notably our new topical prescription cold sore medication, Xerese," Pearson said.
The transaction is expected to close in June 2012, subject to the satisfaction of certain closing conditions, and is expected to be accretive in 2012.
