Warner Chilcott Looking Craftier in Deal Making (WCRX, PG)

September 23, 2009 · Filed Under M&A, psoriasis · Comments Off 

Warner Chilcott plc (NASDAQ: WCRX) may have figured an even cheaper way of acquiring the pharma business from Procter & Gamble (NYSE: PG).  The company is effectively selling its licensing rights of its topical psoriasis treatments to Leo Pharma, who is reacquiring the licensing rights from Warner Chilcott for about $1 billion.  The deal will result in a one-time gain of roughly $450 million and will net Warner Chilcott roughly $980 million in cash.

Leo will also regain the rights to Taclonex, Taclonex Scalp, Dovonex and all products in the developer’s pipeline. Warner Chilcott will continue marketing these drugs for Leo, through the end of the year.  Warner Chilcott is to also further assist with the transition for up to a year.  The companies have been partners since 2003.

Warner Chilcott will use the funds to pa down its senior secured facilities and also to help finance the acquisition of Proctor & Gamble’s pharma division.

As long as the figures come to pass as we have been told through 2010 by Warner Chilcott and P&G, then it seems as though Warner Chilcott has figured out how to be rather crafty in its strategy.

Shares are up over 1% at $19.99 today and the 52-week trading range is $9.24 to $22.94.

JON C. OGG

FDA Hits TNF Blockers (JNJ, ABT, AMGN)

August 4, 2009 · Filed Under Cancer, fda, psoriasis · Comments Off 

The FDA has announced that it will make drug makers disclose added risks of lymphoma and other cancers on TNF Blockers in a Boxed Warning notice.  This pertains to tumor necrosis factor drugs called TNF Blockers associated with the use of drugs for children and adolescents.

  • Johnson & Johnson’s (NYSE: JNJ) makes Remicade;
  • Abbott Labs (NYSE: ABT) makes Humira;
  • Amgen (NYSE: AMGN) for Enbrel.

Cimzia, a Crohn’s Disease treatment made by UCB in Belgium, is also going to have the label.

Most of the drug labels did previously discuss a possible risk of cancer, but a new cancer-related warning will now be added to the warning box that is already on the drug packaging.  These TNF blocker drugs treat Crohn’s disease, juvenile arthritis, rheumatoid arthritis, psoriatic arthritis, plaque psoriasis, and a form of arthritis that eventually fuses the spine.  The drugs suppress the immune system by blocking the substance in the body that causes inflammation.

The FDA is working with these companies to define the higher risks of cancer in children and adolescents in this matter.  It is unclear if this will have any adverse effect on the sales of these drugs.  Unfortunately, those taking the drugs may need the drugs regardless of the Boxed Warning risks.

JON C. OGG
AUGUST 4, 2009

Promising Psoriasis News at FDA, with Severe Risks

June 17, 2008 · Filed Under psoriasis · Comments Off 

A U.S. FDA panel voted on Tuesday to recommend the FDA approval for a proposed Johnson & Johnson (NASDAQ: JNJ) drug called ustekinumab proposed to treat severe-to-moderate psoriasis.  This might be good news but it is not without risks and we don’t just mean to the patients taking the drug.

While this is positive, it is far from a slam dunk.  The FDA panel expressed concerns about the drug’s increased cancer risk.  It also wants the longer-term data and there sounds like there is much caution out of this panel despite the nod.  As a reminder, the FDA does not always vote in favor of a drug approval just because the preliminary FDA Panel recommended a drug for approval.

Psoriasis is a skin disease with dry and cracked skin with red patches that counts more than seven million Americans alone as the current patient group.  It can range from mild to debilitating depending on the cases.  There is still no cure for psoriasis and most treatments on the market today are mildly effective so far.  For the risks of this drug being increased risks of cancer, they are going to have to only offer this up for the severe cases in patients who are willing to take the risks.

The company that can come up with an effective treatment that has few side effects has a mega-blockbuster on its hands.  Unfortunately, that is a big hurdle right now.

Jon Ogg
June 17, 2008

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