RARE Daily

Horizon to Acquire Viela Bio to Expand Pipeline and Grow Rare Disease Portfolio

February 1, 2021

Rare Daily Staff

Specialty pharmaceutical Horizon Therapeutics has entered into a definitive agreement to acquire rare disease drug developer Viela Bio in a deal valued at $3 billion.

Horizon will pay $53 per share for Viela Bio, representing a 53 percent premium to its value ahead of the announcement, and about $2.67 billion net of Viela’s cash and cash equivalents.

The acquisition will give Horizon Viela Bio’s Uplizna, which was approved in June 2020 for the treatment of adults with a particular antibody who have neuromyelitis optica spectrum disorder (NMOSD), a rare, severe, neuro-inflammatory autoimmune disease that attacks the optic nerve, spinal cord and brain stem. In addition to potentially irreversible blindness and paralysis, patients may also experience loss of sensation, bladder and bowel dysfunction, nerve pain and respiratory failure.

NMOSD can be associated with antibodies that bind to a protein called aquaporin-4 (AQP4). Binding of the anti-AQP4 antibody appears to activate other components of the immune system, causing inflammation and damage to the central nervous system. Uplizna injection is approved for intravenous use in NMOSD patients who are AQP4 antibody positive and is only the second approved treatment for the disorder, besides Alexion’s Soliris, which was approved for that indication in 2019.

“This acquisition represents a significant step forward in advancing our strategy – to expand our pipeline in order to accelerate our growth over the long term,” said Tim Walbert, chairman, president, and chief executive officer, Horizon. “Adding Viela’s research and clinical development capabilities along with its deep, mid-stage biologics pipeline to our seasoned R&D and commercial teams, advances our transformation to an innovation-driven biotech company where we will build on the success of Tepezza and Krystexxa to bolster our long-term growth trajectory. We intend to maximize the full potential of Viela’s pipeline, including the pursuit of additional future indications.”

Tepezza is the first approved treatment for thyroid eye disease, a serious, progressive and vision-threatening rare autoimmune disease that is associated with eye bulging, double vision, blurred vision, pain, inflammation, and facial disfigurement, and may cause long-term irreversible damage.

Horizon says the deal will also strengthen its current R&D capability by adding a team with early-stage research, translational and clinical development capabilities along with deep scientific knowledge in autoimmune and severe inflammatory diseases.

Viela has a mid-stage biologics pipeline focused primarily on autoimmune and severe inflammatory diseases that includes a late stage trial of Uplizna in myasthenia gravis, a chronic, rare autoimmune neuromuscular disease and in IgG4-related disease, a group of disorders marked by tumor-like swelling and fibrosis of affected organs; and VIB4920 for the treatments of Sjögren’s syndrome, kidney transplant rejection, and rheumatoid arthritis in mid-stage development.

“We believe that the combined pipeline, including the pursuit of additional potential indications, has the potential to yield innovative new medicines to treat autoimmune and severe inflammatory diseases,” said Bing Yao, chairman and CEO of Viela Bio. “Our collective R&D expertise coupled with Horizon’s commercial capabilities, has the potential to provide benefit to more patients with high unmet treatment needs.”

The acquisition is structured as a two-step cash tender offer for all the issued and outstanding shares of Viela Bio common stock at a price of $53.00 per share. Following successful completion of the tender offer, Horizon will acquire all remaining shares not tendered in the offer through a second step merger at the same price per share as in the tender offer. The transaction has been unanimously approved by Horizon’s and Viela’s boards of directors and is subject to the satisfaction of customary closing conditions. Stockholders holding approximately 54 percent of the outstanding shares of common stock of Viela, including AstraZeneca, have agreed to tender their shares in the offer pursuant to support agreements.

Horizon intends to finance the transaction through $1.3 billion of external debt along with cash on hand. The deal is expected to close by the end of the first quarter of 2021.

Photo: Tim Walbert, chairman, president, and chief executive officer, Horizon

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