Friday, November 11, 2011

Salix Acquires NJ Pharma Firm for $300M; Earnings Soar

Gastrointestinal treatments company Salix Pharmaceuticals will acquire Oceana Therapeutics for $300 million cash in a deal that brings to two more products to add to its portfolio. Morrisville-based Salix announced the deal after the close of the financial markets. Oceana, based in Edison, N.J., has two Food and Drug Administration approved products. Solesta treats fecal incontinence; Deflux treats vesicoureteral refulx, or VUR, an anatomical bladder defect affecting children. Deflux is the only surgical alternative approved by the FDA as a treatment for VUR. 

“The acquisition of Oceana expands our product portfolio of innovative products, furthers the diversification of Salix’s base business and provides immediate added revenue,” Salix CEO Carolyn Logan said in a statement.

Solesta received FDA premarket approval in May as a class III medical device to treat fecal incontinence in patients who fail to respond to more conservative therapies addressing the condition. Oceana launched the product in September. Solesta does not require surgery and the injectable gel can be administered on an outpatient basis without anesthesia. The product also has regulatory approval in Europe.

Salix projects that Solesta sales could reach $500 million. Deflux, which has approval in more than 40 countries, had sales of approximately $26 million through the first nine months of 2011. Logan said that Solesta fits with Salixs specialty sales force that is already in contact with gastroenterologists and colorectal surgeons.

The sale is subject to customary closing conditions, including regulatory approval. Salix expects to close the deal in December. In a conference call with analysts, Logan said that Salix will continue to explore additional acquisitions.

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