Bausch Health to Buy Synergy Pharmaceuticals Out of Bankruptcy for $200 Million--Update

By Chris Wack

Bausch Health Companies Inc. (BHC) is buying substantially all of Synergy Pharmaceuticals Inc.'s (SGYP) assets, including all rights to TRULANCE (plecanatide), dolcanatide and related intellectual property, for $200 million in cash plus the assumption of certain liabilities related to the assets to be acquired.

Synergy Pharmaceuticals said in a release Wednesday that the sale is subject to a competitive process and the company's receipt of higher and better offers, with Bausch Health serving as the stalking horse bidder.

In order to speed up the sale and address its debt obligations, Synergy started voluntary chapter 11 bankruptcy proceedings. The New York-based biopharmaceutical company plans to operate its business as usual while it works to complete the sale through the chapter 11 process.

"We have worked diligently to serve our patients, health care professionals and other stakeholders by bringing TRULANCE to market and developing other gastrointestinal therapies to address previously unmet needs. Unfortunately, we have now reached a point where our financial challenges are preventing us from taking this important work to the next level," said Troy Hamilton, chief executive of Synergy Pharmaceuticals.

Synergy has entered into a binding term sheet with its existing first lien lenders for debtor-in-possession financing in an aggregate principal amount equal to $155 million.

Bausch Health said that it doesn't require any financing to complete the acquisition, and if its bid is successful, the transaction is expected to close in the first quarter of 2019.

Shares of Synergy Pharmaceuticals were down 53% to 16 cents a share premarket, while shares of Bausch Health rose slightly to $23.12 premarket.

Write to Chris Wack at chris.wack@wsj.com

(END) Dow Jones Newswires

December 12, 2018 08:03 ET (13:03 GMT)

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