Almost exactly 1 year after saying it would seek a buyer for its Lap-Band obesity device, Allergan (NYSE:AGN) said today that Apollo Endosurgery agreed to spend up to $110 million on Allergan’s obesity intervention business, which includes the Orbera intra-gastric balloon.
The deal calls for Apollo to put $75 million down in up-front cash, plus another $15 million in minority equity interest and another possible $20 million in milestones pegged to regulatory and sales goals, according to a press release.
"The acquisition of the Lap-Band and Orbera technologies will provide Apollo Endosurgery with a strong revenue stream that will enable us to expand our investment in innovative solutions that focus on improving patient outcomes in both the bariatric and endoscopic spaces," Apollo president & CEO Dennis McWilliams said in prepared remarks. "The addition of these devices will complement Apollo’s portfolio to include less invasive bariatric product offerings while expanding our domestic sales channel and increasing our global reach into more than 40 countries."
"We are pleased to enter into a definitive agreement with Apollo Endosurgery regarding the sale of our obesity intervention business," added Allergan chairman & CEO David Pyott. "We are confident that Apollo Endosurgery has the management expertise, industry experience and commitment to innovation that will be essential to the continued clinical development and future advancement of the Lap-Band and Orbera franchises."
Allergan said last October that it would examine the options for the obesity business, "including among other things, a potential sale of that business unit."