BioMarin Pharmaceutical Inc., a manufacturer that primarily makes rare diseases, shelled out $840 million to buy Prosensa Holding NV, an emerging Dutch biopharmaceutical company in an effort to push for approval of drug against muscular dystrophy.
The San Rafael, Calif.-based BioMarin reported to have paid $17.75 per share of Prosensa to $680 million. The purchase price is 55.2 percent higher than Prosensa's market value on Friday which is $11.44.
Meanwhile, BioMarin will add another $80 million to the check if Drispersen, its muscular dystrophy drug received approval from U.S. regulators before May 2016, and another $80 million if the drug is approved in Europe before February 2017.
Prosensa is currently working on a drug named Drispersen used for a rare form of muscular dystrophy, a genetic condition that affects about 10,000 to 15,000 people in the United States.
Prosensa developed Drispersen in partnership with GlaxoSmithKline back in 2013. However, late-stage clinical trial done back in the same year showed that the drug did not show meaningful benefits related to the disease, but the results are not conclusive that the drug doesn't work, according to BioMarin Chief Medical Officer Henry Fuchs himself.
With the deal, however, the two companies hope that regulators will approve of the drug, which could potentially treat as many as 10,000 people suffering from Duchenne muscular dystrophy across the globe, roughly 13 percent of all patients, according to BioMarin.
Last summer, Prosensa said the FDA would consider approving drisapersen based on new analyses of the company's study data and earlier studies that did show a statistically significant benefit for the drug. If the drug is approved, Prosensa would still have to conduct two additional clinical studies to confirm the drug's benefit, the company said. Prosensa expects to complete its regulatory filing with the agency in the first quarter of 2015.
Shares of BioMarin rose 0.9% to $86.64 in recent trading on Monday. Shares of Prosensa jumped 61.2% to $18.50. The deal is the largest acquisition of BioMarin amidst increasing competition from other drug manufacturers.
Other competitor companies are also working on a treatment for Duchenne muscular dystrophy like PTC Therapeutics and Sarepta Therapeutics, Inc.
Back in August, PTC Therapeutics' drug, Translarna, has reportedly been conditionally approved in the European Union. While Serapta revealed that it also plans to submit an approval application to the FDA in the middle of 2015 for Eteplirsen.
Shares of Sarepta gained 6% to $16.68 in recent trading; shares of PTC rose 2.2% to $40.63.
