Pozen announced Monday that it plans to reincorporate in Ireland under a new name after acquiring a Canadian pharmaceutical company for $146 million.
The Chapel Hill company also announced that Deerfield, a syndicate of health care investors, has agreed to invest $350 million to support the launch of Pozen’s drug Yosprala and to help finance future acquisitions.
Pozen is buying Tribute Pharmaceuticals Canada and changing its name to Aralez Pharmaceuticals. The new company will trade on the Nasdaq exchange and the Toronto Stock Exchange, where Tribute’s shares now trade. The company is just the latest U.S. pharmaceutical company to relocate to Ireland where the corporate tax rate is significantly lower.
The deal puts Pozen on a path to becoming a specialty pharmaceutical company with a focus on cardiovascular treatments, said Adrian Adams, Pozen’s CEO. Adams, who is to become CEO of Aralez, took over as CEO of Pozen last week after the company’s founder and CEO, John Plachetka, retired.
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“John has handed it over to move the company to the next phase, which is a different phase than it’s been historically,” Adams said.
Investors have strongly embraced the new direction. Pozen shares rose $1.43, or 18 percent, to close Monday at $8.98. The stock is up 31 percent over the past week.
Pozen employs 14 people in Chapel Hill and Adams said no decision has been made about whether the company will maintain a presence in North Carolina.
He said Tribute’s 24-person sale force would help Aralez develop relationships with cardiologists and primary care doctors as it prepares to launch Yosprala. Tribute’s portfolio of drugs includes several cardiovascular treatments and other products for treating acute migraines and tension headaches.
Yosprala is an alternative to aspirin for treating heart disease and stroke patients. Although the drug has not yet been approved by the U.S. Food and Drug Administration, Adams said he’s confident it will launch next year.
Deerfield’s investment in Pozen includes purchasing a $75 million equity stake in the company at a price of $7.20 per share; a $75 million note to be converted in six years at a price of $9.54 per share; and up to $200 million in debt financing for future acquisitions.
Deerfield has been an investor in the four public companies that Adams has previously run. His most recent company, Auxilium Pharmaceuticals, was acquired earlier this year by Endo Pharmaceuticals for $2.6 billion.
Auxilium focused on men’s health care, and Adams said building expertise in a specific area is crucial to a pharmaceutical company’s success. He said Yosprala and Tribute’s drug Fibricor provide the company with a solid foundation in the cardiovascular area.
“I think that it’s important in building companies to have an anchor position and we believe with the promise of Yosprala and with Fibricor part of the Aralez Pharmaceuticals that platform should be cardiovascular,” he said. “It’s a space that’s not owned by anyone else.”
Adams said he was approached by Pozen founder Plachetka about taking over as CEO of the company. Pozen had just terminated its licensing agreement for Yosprala with the French pharmaceutical company Sanofi and was contemplating commercializing the drug itself.
Pozen board member Ken Lee Jr. knew Adams, who was CEO of Durham-based Inspire Pharmaceuticals when Lee was Inspire’s chairman.
“This is an opportunity for [Pozen] to really control its own destiny with Aralez,” Adams said.