-On an Adjusted EBITDA Basis, Transaction Expected to be
EBITDA Accretive and to Move Profitability Forward to 2017-
-Company to Host Conference Call on October 4, 2016 at 8:30
a.m. ET-
MISSISSAUGA, Ontario,
Oct. 4, 2016 /PRNewswire/
-- Aralez Pharmaceuticals Inc. (NASDAQ: ARLZ)
(TSX: ARZ), a global specialty pharmaceutical company, today
announced it will acquire the U.S. rights to Toprol-XL® (metoprolol
succinate) and its Authorized Generic (AG) pursuant to an agreement
entered into between AstraZeneca and Aralez Pharmaceuticals Trading
DAC, a subsidiary of Aralez. Toprol-XL is a cardioselective
beta-blocker indicated for the treatment of hypertension, alone or
in combination with other antihypertensives; the long term
treatment of angina pectoris and treatment of stable, symptomatic
(NYHA class II or III) heart failure of specific origins. It was
first approved in the U.S. in 1992. AstraZeneca recorded U.S. net
revenues from Toprol-XL and its AG of $89
million and $53 million in
2015 and year-to-date June 2016,
respectively. The transaction is expected to be immediately EBITDA
accretive and to move profitability forward to 2017, in each case
on an adjusted EBITDA basis. The transaction is expected to be
completed in the fourth quarter of 2016, subject to customary
closing conditions.
The agreement includes an initial upfront payment of
$175 million, which will be financed
through a previously committed senior secured debt facility with
Deerfield Management. At closing, Aralez will also borrow funds
under this credit facility to replenish $25
million that was paid from cash on hand in connection with
the recently announced ZONTIVITY®
acquisition. In addition, Deerfield has agreed to provide Aralez access
to up to an additional $250 million
in capital to fund future mutually agreeable acquisitions. The
transaction with AstraZeneca also includes mid-teen percentage
royalties and up to $48 million of
potential contingent milestone payments. In connection with the
Asset Purchase Agreement, at closing the parties will enter into a
Supply Agreement pursuant to which AstraZeneca will continue to
manufacture and supply Toprol-XL and the AG to Aralez for at least
ten years, a License Agreement with respect to certain trademarks
and copyrights and a Transition Services Agreement. Under the terms
of the Transition Services Agreement, AstraZeneca will continue to
distribute the product on behalf of Aralez for up to nine months
until the product is transferred to Aralez Pharmaceuticals Trading
DAC.
"We are delighted to enter into an agreement with AstraZeneca
for the U.S. rights to Toprol-XL and its AG, a beta blocker that
further broadens our cardiovascular portfolio and, importantly,
strengthens our financial profile by generating meaningful cash,
which should accelerate our profitability to 2017 on an adjusted
basis in addition to offsetting launch costs for
YOSPRALA™ and ZONTIVITY," said Adrian Adams, Chief Executive Officer of Aralez.
"This transaction further reflects our ability to deliver against
the expectations that we set upon the formation of Aralez that
included promoting FIBRICOR®, approval and
commercialization of YOSPRALA, and seizing opportunities to expand
through aggressive business development and licensing as evidenced
by our recent acquisition of ZONTIVITY and now Toprol-XL."
Toprol-XL is an extended-release tablet that belongs to a family
of high blood pressure medications known as beta-blockers.
Extended-release tablets need to be taken only once a day. After
swallowing Toprol-XL, the coating of the tablet dissolves,
releasing a multitude of controlled release pellets filled with
metoprolol succinate. Each pellet acts as a separate drug delivery
unit and is designed to deliver metoprolol continuously over the
dosage interval of 24 hours.
Greenhill & Co. served as Financing Advisor and Willkie Farr & Gallagher LLP served as Legal
Advisor in connection with the transaction.
Conference Call and Webcast
Aralez will host a
conference call today at 8:30 a.m.
ET, to discuss details of the transaction. The webcast can
be accessed live and will be available for replay at
www.aralez.com.
Conference Call Details
Date: Tuesday, October 4, 2016
Time: 8:30 a.m. ET
Dial-in (U.S.): 877-407-8037
Dial-in (International): 201-689-8037
About Hypertension
Hypertension, or high blood
pressure, is dangerous because it makes the heart work too hard and
contributes to atherosclerosis (hardening of the arteries). It
increases the risk of heart disease and stroke, which are the first
and third leading causes of death among Americans. High blood
pressure can also result in other conditions, such as congestive
heart failure, kidney disease, and blindness.
About Toprol-XL
Toprol-XL® is approved for
the treatment of high blood pressure. By lowering blood pressure,
Toprol-XL may lower the risk of fatal and non-fatal cardiovascular
events, primarily strokes and myocardial infarctions. Toprol-XL is
also indicated for the long-term treatment of angina pectoris, to
reduce angina attacks and to improve exercise tolerance and for the
treatment of stable, symptomatic (NYHA Class II or III) heart
failure of ischemic, hypertensive, or cardiomyopathic origin. It
was studied in patients already receiving ACE inhibitors,
diuretics, and, in the majority of cases, digitalis. In this
population, Toprol-XL decreased the rate of mortality plus
hospitalization, largely through a reduction in cardiovascular
mortality and hospitalizations for heart failure.
Control of high blood pressure should be part of comprehensive
cardiovascular risk management, including, as appropriate, lipid
control, diabetes management, antithrombotic therapy, smoking
cessation, exercise, and limited sodium intake. Many patients will
require more than 1 drug to achieve blood pressure goals.
Toprol-XL is supplied as 25mg, 50mg, 100mg and 200mg tablets
designed for oral administration. For full prescribing
information and additional important safety information, please
visit: www.TOPOL-XL.com.
Important Safety Information
Because of the possibility of serious side effects, such as
chest pain or a heart attack, you should not stop taking Toprol-XL
suddenly. If your doctor decides you should stop taking Toprol-XL,
you may be instructed to slowly reduce your dose over a period of
time before stopping it completely.
Toprol-XL may not be right for everyone, especially people who
have the following health conditions:
- Extreme slowing of the heart rate.
- Sudden and severe drop in blood pressure and blood flow through
the body because the heart is not pumping normally.
- Uncontrolled heart failure.
- Slowdown of the heart's electrical signal causing a slower
heart rate.
- Damage to the heart's natural pacemaker that affects the
heart's rhythm unless one has a pacemaker device.
- Any allergies to Toprol-XL or its ingredients.
It is important to take your medications every day as directed
by your doctor.
Patients who have asthma or asthma-like lung disease should, in
general, not take Toprol-XL.
Your doctor may not want you to take Toprol-XL if you are
currently taking certain types of high blood pressure medicine, or
have adrenal gland tumors, diabetes, low blood sugar, liver damage,
overactive thyroid disease, or hardening of the arteries in the
arms or legs.
Your doctor may not want you to start taking Toprol-XL if you
are about to have any type of surgery.
If you have a history of serious allergic reactions, the usual
dose of epinephrine (adrenaline) may not work as well if you are
taking Toprol-XL.
Until you know how you will react to Toprol-XL, avoid activities
that require alertness.
Contact your doctor if you have any difficulty in breathing.
In patients with high blood pressure, the most common side
effects were tiredness, dizziness, depression, diarrhea, itching or
rash, shortness of breath, and slow heart rate. If you experience
any of these or other side effects, contact your doctor.
About Aralez Pharmaceuticals Inc.
Aralez
Pharmaceuticals Inc. (NASDAQ: ARLZ and TSX: ARZ) is a global
specialty pharmaceutical company focused on delivering meaningful
products to improve patients' lives while creating shareholder
value by acquiring, developing and commercializing products
primarily in cardiovascular, pain and other specialty areas.
Aralez's Global Headquarters is in Mississauga, Ontario, Canada, its U.S.
Headquarters is planned to be in Princeton, NJ and the Irish Headquarters is in
Dublin, Ireland. More information
about Aralez can be found at www.aralez.com.
Cautionary Language Concerning Forward-Looking
Statements
This press release includes certain statements
that constitute "forward-looking statements" within the meaning of
applicable securities laws. Forward-looking statements include, but
are not limited to, statements regarding transition matters and our
ability to successfully integrate the acquisition of the U.S.
rights to Toprol-XL and its AG, the closing of the acquisition of
the U.S. rights to Toprol-XL and its AG, including the expected
completion in the fourth quarter of 2016, financing the upfront
payment of the acquisition of the U.S. rights to Toprol-XL and its
AG under the debt facility with Deerfield Management and borrowing
under such facility to replenish cash paid in connection with the
recently announced ZONTIVITY acquisition, access to up to an
additional $250 million in capital
from Deerfield Management to fund future mutually agreeable
acquisitions, payments of royalties and potential contingent
milestones with respect to Toprol-XL and its AG, the distribution
of the product by AstraZeneca on behalf of Aralez for up to nine
months, the manufacture and supply of Toprol-XL and the AG by
AstraZeneca, the benefits of Toprol-XL and its AG, the expected
benefits to us of the acquisition of the U.S. rights to Toprol-XL
and its AG, including that the transaction is expected to be
immediately EBITDA accretive and to move profitability forward to
2017, in each case on an adjusted EBITDA basis, Toprol-XL and its
AG as further broadening our cardiovascular portfolio and the
acquisition as strengthening our financial profile by generating
meaningful cash, offsetting launch costs for YOSPRALA and
ZONTIVITY, the acquisition of the U.S. rights to Toprol-XL and its
AG reflecting our ability to deliver against the expectations that
we set upon our formation, that included promoting FIBRICOR,
approval and commercialization of YOSPRALA, and seizing
opportunities to expand through aggressive business development and
licensing, and other statements that are not historical facts, and
such statements are typically identified by use of terms such as
"may," "will," "would," "should," "could," "expect," "plan,"
"intend," "anticipate," "believe," "estimate," "predict," "likely,"
"potential," "continue" or the negative or similar words,
variations of these words or other comparable words or phrases,
although some forward-looking statements are expressed
differently.
You should be aware that the forward-looking statements included
herein represent management's current judgment and expectations,
and are based on current estimates and assumptions made by
management in light of its experience and perception of historical
trends, current conditions and expected future developments, as
well as other factors that it believes are appropriate and
reasonable under the circumstances, but there can be no assurance
that such estimates and assumptions will prove to be correct and,
as a result, the forward-looking statements based on those
assumptions could prove to be incorrect. Accordingly, actual
results, level of activity, performance or achievements or future
events or developments could differ materially from those expressed
or implied in the forward-looking statements. Our operations
involve risks and uncertainties, many of which are outside of our
control, and any one or any combination of these risks and
uncertainties could also affect whether the forward-looking
statements ultimately prove to be correct and could cause our
actual results, level of activity, performance or achievements or
future events or developments to differ materially from those
expressed or implied by the forward-looking statements. These risks
and uncertainties include, without limitation, our inability to
build, acquire or contract with a sales force of sufficient scale
for the commercialization of YOSPRALA, ZONTIVITY and FIBRICOR in a
timely and cost-effective manner; our failure to successfully
commercialize our products and product candidates; increased
generic competition; costs and delays in the development and/or
approval of our product candidates, including as a result of the
need to conduct additional studies or due to issues with
third-party API or finished product manufacturers, or the failure
to obtain such approval of our product candidates for all expected
indications, including as a result of changes in regulatory
standards or the regulatory environment during the development
period of any of our product candidates; the inability to maintain
or enter into, and the risks resulting from our dependence upon,
collaboration or contractual arrangements necessary for the
development, manufacture, commercialization, marketing, sales and
distribution of any products, including our dependence on
AstraZeneca AB and Horizon Pharma USA, Inc. for the sales and marketing of
VIMOVO, our dependence on Patheon Pharmaceuticals Inc. for the
manufacture of YOSPRALA, our dependence on Schering-Plough
(Ireland) Company for the supply
of ZONTIVITY and (following the closing of the acquisition of the
U.S. rights thereto) our dependence on AstraZeneca AB for the
manufacture and supply of Toprol-XL and its AG; our ability to
protect our intellectual property and defend our patents;
regulatory obligations and oversight; failure to successfully
identify, execute, integrate and maintain new acquisitions, such as
the integration of ZONTIVITY and (following the closing of the
acquisition of the U.S. rights thereto) Toprol-XL and its AG;
fluctuations in the value of certain foreign currencies, including
the Canadian dollar, in relation to the U.S. dollar, and other
world currencies; changes in government regulations, including tax
laws and unanticipated tax liabilities; general adverse economic,
market and business conditions; and those risks detailed from
time-to-time under the caption "Risk Factors" and elsewhere in the
Company's Securities and Exchange Commission ("SEC") filings and
reports and Canadian securities law filings, including in our
Annual Report on Form 10-K for the year ended December 31, 2015 and our Quarterly Report on
Form 10-Q for the quarterly period ended June 30, 2016, which are available on EDGAR at
www.sec.gov, on SEDAR at www.sedar.com, and on the Company's
website at www.aralez.com, and those described from time to time in
our future reports filed with the SEC and applicable securities
regulatory authorities in Canada.
You should not place undue importance on forward-looking statements
and should not rely upon this information as of any other date. We
undertake no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise, unless required by law.
Contact Information:
Aralez Pharmaceuticals US Inc.
Nichol Ochsner
Executive Director,
Investor Relations & Corporate Communications
732.754.2545
nochsner@aralez.com
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SOURCE Aralez Pharmaceuticals Inc.