MannKind expands pipeline with $350M acquisition
Westlake Village-based MannKind Corporation is expanding its pipeline by acquiring scPharmaceuticals, a Massachusetts-based biotech company that specializes in cardiorenal medicine, for $360 million, or $5.35 per share.
Announced before the markets opened Aug. 25, MannKind shares ticked up about 1% in pre-market trading. Shares ultimately settled at $3.90 on Aug. 25, about 3.1% down. Shares of scPharmaceuticals closed at $5.52 with a 13% gain.
ScPharma currently markets one treatment, Furoscix, an FDA-approved on-body infuser delivering furosemide to treat fluid overload in adult patients with chronic heart failure (CHF) and chronic kidney disease (CKD). The estimated total addressable market opportunity equates to more than $10 billion in the U.S., the company said in a press release.
In regard to financials, scPharma has started the year strong, ending June 30 with net sales of $27.8 million, a 96% increase year-over-year.
This acquisition marks MannKind’s strategic expansion into cardiorenal medicine, establishing the company’s cardiometabolic business alongside its orphan lung division.
“This acquisition expands our patient-centered brands and highlights MannKind’s dedication to delivering innovative therapies for cardiometabolic and orphan lung diseases,” said MannKind CEO Michael Castagna. “With multiple anticipated product launches and indication expansions, we expect to continue to diversify our revenue streams and accelerate our double-digit growth goals over the next decade.”
The combined company will have a few different products, including three commercial assets, Afrezza, Furoscix and V-Go.
This deal was also made possible by MannKind’s recent announcement of entering into a financing agreement worth up to $500 million with Blackstone, the world’s largest alternative asset manager, with more than $1 trillion in assets under management.
MannKind and Blackstone amended their recently announced strategic financing agreement to provide $175 million of additional funding to support the acquisition.
Jefferies LLC acted as the exclusive financial advisor to MannKind, with Cooley LLP serving as legal counsel. Leerink Partners acted as exclusive financial advisor to scPharmaceuticals, with Latham & Watkins LLP providing legal counsel.
