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Novartis buys US-Australian pharma in US$700m deal
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Novartis buys US-Australian pharma in US$700m deal

30.06.2015 - Pharma giant Novartis has bumped up its neuroscience portfolio with the recent purchase of Australian biotech Spinifex for a US$200m upfront payment plus US$500 in milestone payments. The acquisition is centred on Spinifex’ mid-stage pain drug EMA401.

The Australian drug developer Spinifex Pharma, which is now headquartered in Connecticut (US), is developing a potential first-in-class oral treatment for chronic pain. In particular, neuropathic pain that does not cause central nervous system side effects. Spinifex’ lead candidate, EMA401, a novel angiotensin II type 2 (AT2), could help to treat pain associated with diabetes, shingles (e.g. postherpetic neuralgia (PHN)), chemotherapy and osteoarthritis. Drugs and treatment that target neuropathic pain are urgently needed, as existing treatment is not well tolerated in all individuals and does not relieve pain in some. With the sale, Novartis will continue the development of EMA401 and is also planning to initiate Phase 2b clinical trials in patients with painful diabetic neuropathy (PDN). It also intends to build on these two key indications and pursue a broad peripheral neuropathic pain (PNP) label for EMA401.

Novartis’ US$200m (€180m) deal with the Australian biotech includes further clinical development and regulatory milestones. According to The Sydney Morning Herald, the Swiss giant has committed up to an additional US$500m (€447m) in milestone payments. The upfront payment assures all existing investors a return of at least three times their invested capital. If milestone payments are achieved, which are based on the success of future late-stage clinical trials, it would bring the value of the total deal to US$700m (€626m).

It was the most successful exit in the history of Australia's venture capital industry.


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M&ASwitzerland

30.06.2015 Pharma giant Novartis has bumped up its neuroscience portfolio with the recent purchase of Australian biotech Spinifex for a US$200m upfront payment plus US$500 in milestone payments. The acquisition is centred on Spinifex’ mid-stage pain drug EMA401.

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No liability assumed, Date: 30.06.2015