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Chiesi to acquire 100% of Cornerstone Therapeutics

Wednesday, September 18, 2013

European pharma company Chiesi Farmaceutici will acquire 100% of Cornerstone Therapeutics, a North Carolina-based specialty pharmaceutical company commercializing products for the U.S. hospital and adjacent specialty markets.

Both companies’ boards of directors have approved the definitive merger agreement, under which Chiesi will acquire all outstanding common shares for $9.50 per share in cash. Chiesi currently owns 58% of the outstanding common shares.

The deal represents a 78% premium over Cornerstone’s closing price of $5.35 Feb. 15, 2013, the last trading day prior to Chiesi’s initial written proposal, and a 42% premium to the high end of the range of Chiesi’s initial proposal.

The buy advances Chiesi’s initiative to build a larger global presence and represents a significant step toward strengthening its presence in the U.S. The acquisition creates a foundation for new projects in special care and respiratory disorders and will provide a sales channel on all products Chiesi intends to commercialize in the U.S.

Through this transaction, Chiesi said it will become a bigger player in special care in the U.S., the world’s largest market for this type of care (50% of projects in orphan drugs originate in the U.S.). Chiesi’s product pipeline includes molecules for the treatment of respiratory and rare diseases, and will continue to develop its pipeline as it consolidates its presence in the U.S.

The transaction positions Cornerstone for long-term growth and development as a private company and affords a level of financial flexibility required to enhance its product pipeline, strengthen its marketing network and allow it to capitalize on additional opportunities to acquire high-quality respiratory products.

“We are excited to announce this transaction, which offers immediate and significant cash value to Cornerstone stockholders, and creates enhanced flexibility for Cornerstone to grow and prosper in the global marketplace,” said Ugo Di Francesco, CEO of Chiesi. “With the support of Chiesi, Cornerstone will help fulfill its mission to develop and commercialize innovative pharmaceutical solutions to improve the quality of human life.”

The transaction is expected to be completed in the first quarter of 2014, subject to conditions including the approval of a majority of Cornerstone’s stockholders.

A week earlier, Chiesi Group signed, through its U.K. affiliate, Chiesi Ltd., a definitive agreement with Sunstone Capital to acquire Zymenex Holding, a biopharmaceutical group focused on R&D of innovative biologic therapeutics to treat rare and life-threatening genetic diseases. Terms were not disclosed.

The acquisition includes Lamazym, a phase III recombinant enzyme to treat patients suffering from alpha-Mannosidosis, a genetic disease that causes a progressive impairment of the cental nervous system, as well as other early-stage compounds. The buy will establish an R&D position for Chiesi in the recombinant biologics market for rare diseases.

“This transaction marks Chiesi’s entrance into the rare disease space and provides an opportunity to access high-potential markets,” said Di Francesco. “Given the rarity of the condition and the importance of being close to the patients, we will consider setting up a standalone rare disease unit that would cover all major geographies, including the U.S.”

Chiesi expects to gradually integrate Zymenex into its R&D structure and retain the Zymenex and Lamazym brands.

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