Shire to Acquire ViroPharma for $4.2 Billion

Shire, based in Dublin announced on Monday that it had agreed to acquire ViroPharma for $4.2 billion to expand its rare disease treatments portfolio.

The company said it agreed to pay $50 a share for the Pennsylvania based ViroPharma, which is 27% higher than the Friday price at closing and a premium of 64% over its September 12 close, when speculation first surfaced that the company had been reconsidering its future.

While a number of companies in the pharmaceutical industry are opening their wallets to bring aboard innovative treatments aimed at the widespread diseases across the globe, Shire hopes its focus on just uncommon diseases will prove to be profitable.

In August, the biotech company agreed to an extension of its development and discovery deal with Denmark based Santaris Pharma, where the two are searching for new treatments for genetic disorders that are rare.

The ViroPharma acquisition will benefit Shire immediately and is consistent in its entirety with the company’s strategic objective of making the portfolio for rare disease treatments stronger, said Flemming Omskov, the CEO.

The acquisition of ViroPharma allows Shire to widen its drug portfolio for treatment and prevention of hereditary angiodema, which causes a spontaneous swelling of mucous membranes and the skin.

Cinryze from ViroPharma is a treatment to prevent the attacks, while Firazyr, from Shire is used while the attack is taking place.

Sales at ViroPharma were up by 24% during the most recent third quarter to end at $113 million. The company also is the producer of treatments for adrenal insufficiency in adults and for treating infants as well as adolescents with seizures.

Shire credited Cinryze for its jump in sales and said it had swung from a loss one year ago of $5 million to a $4 million net income.

ViroPharma is not immune to competition from generic competition that many large pharmaceutical companies are worried about. The company suffered a loss of more than $59 million over the first three quarters of this year, which was up from a $10 million loss during the same period in 2012. This was due in part from generic competition that hit Vancocin, its gastrointestinal bugs treatment.