Sun Pharma to acquire US-based InSite Vision for $48 million

By: Pharma News | Views: 4560 | Date: 19-Sep-2015

Mumbai: One of the subsidiaries of Sun Pharmaceutical Industries Ltd, the largest Indian drugmaker, has entered into an agreement to acquire US-based InSite Vision Inc. in a deal worth $48 million (about Rs.300 crore), the firm said on Wednesda

Sun Pharma to acquire US-based InSite Vision for $48 million

Mumbai: One of the subsidiaries of Sun Pharmaceutical Industries Ltd, the largest Indian drugmaker, has entered into an agreement to acquire US-based InSite Vision Inc. in a deal worth $48 million (about Rs.300 crore), the firm said on Wednesday.

Under the terms of the agreement and plan of merger, an indirect wholly owned subsidiary of Sun Pharma will make a tender offer for all of the issued and outstanding common stock of InSite Vision at a price of $0.35 per share in cash—a 30% premium to the implied price per share, the statement said.

The transaction has a total equity value of about $48 million on fully diluted basis plus related debt and other transaction costs, assuming that all shares of InSite Vision are tendered in the offer.

InSite Vision’s board of directors has also approved the transaction and unanimously recommended that its stockholders give their shares based on the tender offer.

For the six-month period ended 30 June, InSite Vision recorded revenues of $3.8 million, an Ebitda (earnings before interest, tax, depreciation and amortization) loss of $6.4 million and a net loss of $7.5 million.

InSite Vision focuses on developing new specialty ophthalmic products, including three late-stage programmes. Sun Pharma, which is in the process of establishing a branded ophthalmic business in the US, will see the growth through acquisitions of InSite Vision, and recent in-licensing of Xelpros (Latanoprost BAK-free eye drops), a company statement said.

InSite Vision has developed the DuraSite and DuraSite2 drug delivery platforms, which are capable of extending the duration of drug retention, thus resulting in lower dosing frequency and potentially enhanced efficacy.

Based on this technology, InSite Vision has developed a pipeline of late-stage clinical candidates, and has recently filed a New Drug Application (NDA) with US Food and Drug Administration (FDA) for BromSite (0.075% bromfenac) for the treatment of inflammation and prevention of pain associated with cataract surgery.

InSite Vision also plans to file another NDA in 2017 for DexaSite (0.1% dexamethasone) for the treatment of non-bacterial blepharitis, a common ocular condition for which there is no approved product currently available, it said.

Its AzaSite Plus is currently in Phase-3 clinical development for the treatment of eye infections, and ISV-101 is in Phase 1/2 clinical development for dry-eye disease and inflammation.

As part of strengthening their presence in the US, Indian pharmaceutical companies are in an acquisition mode. In July, Lupin Ltd announced the acquisition of US generic drug maker Gavis Pharmaceuticals Llc for $880 million, recording the largest overseas purchase by an Indian drug maker.

The Mumbai-based Cipla Ltd, which is getting less than 8% of its revenue from the US, the world’s largest pharmaceutical market, acquired US-based InvaGen Pharmaceuticals Inc. and Exelan Pharmaceuticals Inc. for $550 million in September.

Generic drugs make up 80% of the prescriptions dispensed in the US but account for just 27% of total drug spending. The US generics market is estimated at an yearly $35 billion, more than double the Indian pharmaceutical market estimated at $14 billion.

“The potential addition of the InSite Vision portfolio serves as a significant step towards enhancing our branded specialty pipeline in the ophthalmic segment. InSite Vision will bring with it a pipeline of three late-stage clinical candidates, validated drug delivery technology and a track record of achieving US FDA approval for ophthalmic products,” said Jerry St. Peter, vice-president and the head of Sun Pharma’s US ophthalmic business.


Sun Pharmaceutical Industries Ltd. announced that one of its subsidiary has entered into an agreement and plan of merger with InSite Vision Inc. (InSite Vision) under which a Sun Pharma subsidiary has offered to acquire InSite Vision. InSite Vision focuses on developing new specialty ophthalmic products, including three late stage programs. Sun Pharma is in the process of establishing a branded ophthalmic business in the US. This proposed acquisition of InSite Vision, coupled with the recent in-licensing of Xelpros™ (Latanoprost BAK-free eye drops) in June 2015, are steps in this direction. These deals give Sun Pharma access to four late stage branded ophthalmic products in the US.

InSite Vision has developed the DuraSite® and DuraSite2® drug delivery platforms which are capable of extending the duration of drug retention, thus resulting in lower dosing frequency, and potentially enhanced efficacy. Based on this technology, InSite Vision has developed a pipeline of late-stage clinical candidates, and has recently filed a New Drug Application (NDA) with the US FDA for BromSite™ (0.075% bromfenac) for the treatment of inflammation and prevention of pain associated with cataract surgery. It plans to file another NDA in 2017 for DexaSite™ (0.1% dexamethasone) for the treatment of non-bacterial blepharitis, a common ocular condition for which there is no approved product currently available. It’s AzaSite Plus™ is currently in Phase-3 clinical development for the treatment of eye infections, and ISV-101 is in Phase 1/2 clinical development for dry-eye disease and inflammation.

InSite Vision also has two commercialized products based on its innovative DuraSite® platform approved for the treatment of bacterial eye infections, AzaSite®(azithromycin ophthalmic solution) 1%, and Besivance® (besifloxacin ophthalmic suspension) 0.6%, marketed by respective partners.

Commenting on the deal, Jerry St. Peter, Vice President & Head of Sun Pharma’s U.S. Ophthalmic Business said “The potential addition of the InSite Vision portfolio serves as a significant step towards enhancing our branded specialty pipeline in the Ophthalmic segment. InSite Vision will bring with it a pipeline of three late-stage clinical candidates, validated drug delivery technology and a track record of achieving US FDA approval for ophthalmic products.”

Kal Sundaram, CEO of Sun Pharma’s North American Business said “This potential acquisition is a part of our overall objective of transitioning to a specialty company. Besides Dermatology, we have identified Ophthalmics as one of the key segments for establishing our branded presence in the U.S.”

Under the terms of the agreement and plan of merger, an indirect wholly owned subsidiary of Sun Pharma will commence a tender offer for all of the issued and outstanding common stock of InSite Vision at a price of US$0.35 per share in cash, a 30% premium to the implied price per share under the terminated ‘Amended and Restated Agreement and Plan of Merger’ between InSite Vision and a competing bidder for InSite Vision’s common stock based on the stock price of the competing bidder as of September 11, 2015. The transaction has a total equity value of approximately US$48 million on fully diluted basis plus related debt and other transaction costs assuming all shares of InSite Vision are tendered in the offer. The transaction has been approved by the board of directors of the Sun Pharma subsidiary. InSite Vision’s board of directors has also approved the transaction and unanimously recommended that its stockholders tender their shares pursuant to the tender offer.

For the 6 month period ended June 30, 2015, InSite Vision recorded revenues of US$ 3.8 million, an EBITDA loss of US$ 6.4 million and a net loss of US$ 7.5 million.

The acquisition is subject to InSite Vision’s stockholders tendering at least a majority of InSite Vision’s outstanding shares (determined on a fully diluted basis), or, alternatively, InSite Vision stockholders representing a majority of the outstanding shares of InSite Vision’s common stock voting to approve the transaction as required by applicable law, in addition to other customary closing conditions. The acquisition is expected to close in the fourth quarter of 2015.

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