Ipsen (Euronext: IPN; ADR: IPSEY) today announced that it has entered into a definitive agreement to acquire global oncology assets from Merrimack Pharmaceuticals (NASDAQ: MACK), including its key marketed product ONIVYDE® (irinotecan liposome injection) for the treatment of patients with metastatic adenocarcinoma of the pancreas after disease progression following gemcitabine-based therapy, in combination with fluorouracil and leucovorin. Under the terms of the agreement, Ipsen will gain exclusive commercialization rights for the current and potential future ONIVYDE indications in the U.S., as well as the current licensing agreements with Shire for commercialization rights ex-U.S. and PharmaEngine for Taiwan. The transaction also includes Merrimack’s commercial and manufacturing infrastructure, and generic doxorubicin HCl liposome injection.

– Transaction includes U.S. commercialization rights for ONIVYDE® for metastatic pancreatic cancer in adult patients [1]
– $575 million cash at closing and additional potential payments for new indications
– Transaction bolsters Ipsen’s growing oncology presence and leverages Oncology infrastructure in the U.S.

The transaction represents a unique opportunity and a strong strategic fit for Ipsen. ONIVYDE is a clinically differentiated and FDA-approved product for patients with high unmet medical needs. The transaction secures a marketed, wholly-owned asset with current U.S. revenues and significant revenue growth projections, based on solid clinical data and potential approvals in additional indications already in clinical development. Furthermore, there are significant commercial synergies to be realized by integrating the ONIVYDE franchise with the existing Ipsen U.S. oncology commercial infrastructure, which has strong expertise and a proven track record with Somatuline®. As a result, this transaction strengthens Ipsen’s Oncology franchise and accelerates both its near- and long-term growth trajectory and profitability.

David Meek, CEO of Ipsen, commented, “The acquisition of ONIVYDE represents a compelling strategic opportunity to further strengthen Ipsen’s oncology portfolio while leveraging our U.S. infrastructure and creating meaningful potential incremental growth and profitability. Pancreatic cancer is now the third leading cause of cancer-related deaths. It is an area that has had many drug failures and very few FDA approvals over the past two decades. For the tens of thousands of patients living with pancreatic cancer in the U.S. who have received prior treatment with gemcitabine, ONIVYDE represents an important, differentiated innovation, given its proven overall survival benefit in an area of high unmet medical need with few approved therapies.”

“ONIVYDE is a landmark, recently approved therapeutic option for metastatic pancreatic cancer. Since the launch in the fourth quarter of 2015, many patients have already benefitted from ONIVYDE.” said Cynthia Schwalm, Executive Vice President, North America Commercial Operations, Ipsen. “Based on our track record of successfully bringing oncology products to patients, we are confident in our ability to leverage our operational and clinical development capabilities, and experienced commercial and medical affairs teams to ensure eligible patients have access to ONIVYDE in the U.S.”

Ipsen will be responsible for advancing the ongoing ONIVYDE clinical development program, which includes a Phase 2 trial in first-line previously untreated metastatic pancreatic cancer, a Phase 2/3 trial in relapsed small-cell lung cancer, and a Phase 1 pilot trial in breast cancer.

Under the terms of the agreement, Ipsen will pay $575 million cash at closing plus up to $450 million upon the approval of potential additional indications for ONIVYDE in the U.S. The transaction will be fully financed by Ipsen’s existing cash and lines of credit. The deal should be dilutive in 2017 and accretive from 2018 onwards both in operating margin and EPS. The transaction, which is subject to customary closing conditions, including governmental regulatory clearances, and a vote by Merrimack shareholders, is expected to close by the end of the first quarter of 2017.

Ipsen was advised on this transaction by MTS Health Partners, LP and Dechert LLP.