Collegium to Acquire BioDelivery Sciences Broadening Pain Portfolio
- Expected to be Immediately and Highly Accretive Driven by Identified Annual Synergies of at Least
- Will Diversify Revenue Growth and Accelerate Cash Flow Generation -
- Addition of BELBUCA® Provides a Second Growth Driver and ELYXYB™ Establishes Foothold in Neurology -
- Conference Call Scheduled for Today at
BDSI has a portfolio of pain and neurology products that address serious and debilitating conditions. BDSI’s commercial growth driver, BELBUCA, is a meaningfully differentiated schedule III opioid product and is highly complementary to Collegium’s portfolio of pain products. Additional products in the BDSI portfolio include Symproic®, a contributor, and ELYXYB, a neurology product in its early launch phase.
“We are excited to announce this acquisition, which represents a major step forward in our mission to build a leading, diversified specialty pharmaceutical company committed to improving the lives of people suffering from serious medical conditions,” said
“We are pleased to announce the transaction with Collegium, which we view as a testament to the attractiveness of our portfolio and long-term value of our brands,” said
- Strategically aligned with Collegium’s mission to build a leading, diversified specialty pharmaceutical company committed to improving the lives of people suffering from serious medical conditions
- Diversifies and expands Collegium’s revenues by adding BELBUCA as a second and highly complementary growth driver to Collegium’s highly differentiated pain portfolio, in addition to a contributor with Symproic, and a new product launch opportunity with ELYXYB
- Further strengthens Collegium’s financial position through increased revenue scale, immediate and significant earnings accretion, and accelerated cash flow generation, driven by identified annual run rate synergies of at least
$75 millionexpected to be achieved within twelve months post-closing
- ELYXYB provides entry into the neurology market, a strategic market adjacency previously identified by Collegium
Additional Transaction Details
- Under the terms of the definitive agreement, Collegium will promptly commence a tender offer to acquire all the outstanding shares of BDSI at the price of
- The offer price of
$5.60represents a 54% premium to BDSI closing share price of $3.64as of Friday, February 11, 2022, and implies a fully diluted equity value of approximately $604 millionusing the treasury stock method
- The all-cash consideration will be funded by a combination of Collegium existing cash on hand and a
$650 millionsecured financing from funds managed by Pharmakon Advisors, LP(“Pharmakon”), with a four-year term, which will bear an interest rate of Libor+750bps and will be amortized over four years
- As part of the transaction, Collegium will repay the existing Collegium term loan from Pharmakon and the existing BDSI term loan from Pharmakon
- Post-closing, we expect Collegium net leverage to be below 3.0x based on estimated fiscal year 2021 pro forma combined EBITDA including run rate synergies
- Collegium expects to achieve annual run rate synergies of at least
$75 million, based off of BDSI estimated 2021 operating expenses, within twelve months post-closing
- Collegium expects this transaction to be highly accretive to earnings in 2022 and 2023
Timing to Close
The transaction, which has been unanimously approved by the boards of directors of both companies, is expected to close late in the first quarter 2022, subject to customary closing conditions, including receipt of required regulatory approvals and the tender of a majority of outstanding shares of BDSI’s common stock. Following the successful closing of the tender offer, Collegium will acquire any shares of BDSI that are not tendered in the tender offer through a second-step merger at the same consideration as paid in the tender offer.
Jefferies LLC is acting as the exclusive financial advisor to Collegium.
Conference Call and Webcast
The Company will host a conference call and live audio webcast on
About BioDelivery Sciences International, Inc.
BioDelivery Sciences International, Inc. is a commercial-stage specialty pharmaceutical company dedicated to patients living with chronic conditions. BDSI has built a portfolio of differentiated pain and neurology products and leverages its experienced sales and marketing organization to educate prescribers on their unique features. BDSI's products address serious and debilitating conditions, including chronic pain, acute migraine and opioid-induced constipation.
This press release contains forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. We may, in some cases, use terms such as "predicts," "forecasts," "believes," "potential," "proposed," "continue," "estimates," "anticipates," "expects," "plans," "intends," "may," "could," "might," "should" or other words that convey uncertainty of future events or outcomes to identify these forward-looking statements. Examples of forward-looking statements contained in this press release include, among others, statements related to the acquisition of BioDelivery Sciences International, Inc. (“BDSI”) and the anticipated timing and benefits thereof, our strategy, plans, objectives, expectations (financial or otherwise) and intentions, future financial results and growth potential, potential synergies, anticipated product portfolio, development programs, patent terms and other statements that are not historical facts. Such statements are subject to numerous important factors, risks and uncertainties that may cause actual events or results, performance, or achievements to differ materially from the company's current expectations. Actual results may differ materially from management’s expectations and such forward-looking statements in this press release could be affected as a result of various important factors, including risks relating to, among others: risks related to our ability to complete the transaction on the proposed terms and schedule or at all; whether the tender offer conditions will be satisfied, including whether sufficient stockholders of BDSI tender their shares in the transaction; the outcome of legal proceedings that may be instituted against BDSI and/or others relating to the transaction; the failure (or delay) to receive the required regulatory approvals relating to the transaction; the possibility that competing offers will be made; risks related to the ability to realize the anticipated benefits of the proposed acquisition, including the possibility that the expected benefits from the acquisition will not be realized or will not be realized within the expected time period; the risk that the businesses will not be integrated successfully; disruption from the transaction making it more difficult to maintain business and operational relationships; negative effects of this announcement or the consummation of the proposed acquisition on the market price of our common stock and/or operating results; significant transaction costs; unknown liabilities; the risk of litigation and/or regulatory actions related to the proposed acquisition; risks related to future opportunities and plans for BDSI and its products, including uncertainty of the expected financial performance of BDSI and its products; the impact of the COVID-19 pandemic on our ability to conduct our business, reach our customers, and supply the market with our products; our ability to commercialize and grow sales of our products; our ability to manage our relationships with licensors; the success of competing products that are or become available; our ability to obtain and maintain regulatory approval of our products and any product candidates, and any related restrictions, limitations, and/or warnings in the label of an approved product; the size of the markets for our products and product candidates, and our ability to service those markets; our ability to obtain reimbursement and third-party payor contracts for our products; the rate and degree of market acceptance of our products and product candidates; the costs of commercialization activities, including marketing, sales and distribution; changing market conditions for our products; the outcome of any patent infringement, opioid-related or other litigation that may be brought by or against us, including litigation with
Additional Information about the Transaction and Where to Find It
The tender offer (the “Offer”) described in this press release has not yet commenced, and this release is neither a recommendation, nor an offer to purchase nor a solicitation of an offer to sell any shares of the common stock of BDSI or any other securities. On the commencement date of the Offer, a tender offer statement on Schedule TO, including an offer to purchase, a letter of transmittal and related documents, will be filed with the
Head of Investor Relations and Corporate Communications
Source: Collegium Pharmaceutical, Inc.