Sobi to acquire Dova Pharmaceuticals creating a global growth platform in haematology
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- Published on Tuesday, 01 October 2019 13:27
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STOCKHOLM, Sweden I September 30, 2019 I Swedish Orphan Biovitrum AB (publ) (Sobi™) (STO: SOBI) today announced a definitive agreement to acquire Dova Pharmaceuticals, Inc. (NASDAQ:DOVA) by means of a tender offer. The consideration consists of an upfront payment of USD 27.50 per share in cash and, one non-tradeable Contingent Value Right (CVR). The CVR entitles Dova shareholders to an additional USD 1.50 per share upon approval of Doptelet® for use in Chemotherapy-Induced Thrombocytopenia (CIT) by the US Food and Drug Administration (FDA). The upfront cash component of the offer represents a premium of 36 per cent based on Dova's most recent closing price of USD 20.19. The transaction is valued at up to USD 915 million (approximately SEK 9.0 billion) on a fully diluted basis.
- The acquisition of Dova provides Sobi with Doptelet (avatrombopag), a differentiated on-market product in Chronic Immune Thrombocytopenia (ITP), a well established and growing market, for Chronic Liver Disease (CLD) and an ongoing phase 3 trial in Chemotherapy Induced Thrombocytopenia (CIT)
- The acquisition of Dova will broaden the scope of Sobi's product portfolio into haematology and enhance Sobi's commercial presence in the United States
- Doptelet will further diversify Sobi's revenue base adding a new growth driver
- Sobi will leverage its expertise and existing infrastructure in haematology to grow Doptelet across its indications by expanding patient access outside the US.
Dova Pharmaceuticals was founded in 2016 to commercialise Doptelet, a second generation small-molecule thrombopoietin receptor (TPO) agonist used in the treatment of thrombocytopenia by increasing platelet count. In May 2018, Doptelet was approved by the FDA for the treatment of thrombocytopenia in adult patients with Chronic Liver Disease (CLD) who are scheduled to undergo a procedure, and in June 2019 for Chronic Immune Thrombocytopenia (ITP) in adult patients who have had an insufficient response to a previous treatment. Doptelet was approved by the European Medicines Agency (EMA) for Chronic Liver Disease (CLD) in June 2019, and a European filing for the Chronic Immune Thrombocytopenia (ITP) indication is expected in 2020. ITP is a rare autoimmune bleeding disorder characterised by a low number of platelets.
Dova is also conducting a phase 3 trial in Chemotherapy-Induced Thrombocytopenia (CIT) which is a common side effect of chemotherapy that results in a low number of platelets. At present, there are no approved drugs to treat CIT.
The acquisition of Dova is the latest in a series of transformative transactions Sobi has conducted to broaden its haematology and immunology portfolios by, adding commercial stage products and a late-stage pipeline. By acquiring Dova, Sobi will enhance its capabilities in the US market with key haematologist callpoints to further develop its existing franchises.
The current TPO market is estimated at USD 2.0 billion and represents an attractive commercial opportunity. Doptelet's recent launch in ITP in the US is a first step to capturing significant market share in the mid-term. In addition, Doptelet has the potential to become the first-to-market drug to treat CIT.
"The cadence of upcoming launches and approvals across indications and regions that Doptelet provides, enables us to further accelerate growth in our haematology franchise", said Guido Oelkers CEO and President at Sobi. "There is a large unmet medical need within thrombocytopenia and for us this is a great opportunity to be able to give patients access to new and improved treatments. Furthermore, we are excited to welcome the 125 professionals from Dova who will greatly strengthen Sobi's haematology infrastructure and broaden our value chain in the US."
Under the terms of the agreement, Sobi will commence a tender offer to purchase all outstanding shares of Dova for a purchase price of USD 27.50 per share in cash, as well as one CVR per share. The CVR will entitle the holder to an additional USD 1.50 per share at the time FDA approves Doptelet for the treatment of CIT. The tender offer is conditioned on the tender of a majority of the outstanding shares of Dova's common stock. Any shares of Dova common stock not tendered will be acquired through a merger effected as soon as practicable following the tender offer closing, for the same per share consideration. Dova shareholders holding a majority of Dova's currently outstanding shares, including Paul B. Manning and related entities, have agreed to tender their shares into the offer. The offer is also conditioned upon clearance under the Hart-Scott-Rodino Antitrust Improvements Act, as well as other customary closing conditions. The transaction is expected to close in Q4 2019.
The acquisition of Dova will be financed by a mix of existing cash resources and debt comprised of new committed credit facilities as well as Sobi's existing credit facilities. The new financing consists of a SEK 3 billion term loan facility with a term of up to five years, and a EUR 280 million revolving credit facility with a term of up to five years, both arranged and made available by Danske Bank and Skandinaviska Enskilda Banken. The remaining part of the debt-financing is intended to be financed through Sobi's existing credit facilities
Morgan Stanley is acting as Sobi's exclusive financial advisor and Cravath, Swaine & Moore LLP is acting as legal advisor to Sobi on this transaction. Mannheimer Swartling Advokatbyrå AB is acting as Swedish legal counsel in the transaction.
Dova Pharmaceuticals was founded in 2016 to commercialise Doptelet® (avatrombopag) for the treatment of thrombocytopenia. Total revenue amounted to USD 10.4 million for 2018 with approximately 125 employees. Dova Pharmaceuticals' portfolio comprises of one commercial product, Doptelet. Doptelet is an oral thrombopoietin (TPO) receptor agonist administered with food. Doptelet is approved by both United States Food and Drug Administration (FDA) and European Medicines Agency (EMA) for treatment of thrombocytopenia (low platelet counts) in adults with chronic liver disease (CLD). In June 2019, Doptelet was approved for chronic immune thrombocytopenia (ITP) by FDA, filing is expected in early 2020 in Europe. Chronic ITP is a rare autoimmune bleeding disorder characterised by low number of platelets, affecting approximately 60,000 adults in the United States.
At Sobi, we are transforming the lives of people affected by rare diseases. As a specialised international biopharmaceutical company, we provide sustainable access to innovative therapies in the areas of haematology, immunology and specialty care. We bring something rare to rare diseases – a belief in the strength of focus, the power of agility and the potential of the people we are dedicated to serving. The hard work and dedication of our approximately 1,300 employees around the globe has been instrumental in our success across Europe, North America, the Middle East, Russia and North Africa, leading to total revenues of SEK 9.1 billion in 2018. Sobi's share (STO:SOBI) is listed on Nasdaq Stockholm. You can find more information about Sobi at www.sobi.com.