Baxter (NYSE:BAX) said today it inked an agreement with Mallinckrodt Pharmaceuticals (NYSE:MNK) to acquire its Recothrom and Preveleak hemostat and sealant products for approximately $153 million up front with a potential for contingent payments in the future.
Mallinckrodt’s Recothorm is a stand-alone recombinant thrombin-based product with indications as an aid to hemostasis to control oozing blood and minor bleeding from capillaries and small venules when control of bleeding by standard surgical techniques is ineffective or impractical.
The Preveleak sealant is designed to seal suture holes during surgical repair of the circulatory system and to reinforce sutured connections between blood vessels.
“Uncontrolled intraoperative bleeding can lead to a wide variety of clinical and economic complications for patients and hospitals. As a leading provider of advanced hemostats and sealants, Baxter is focused on continually identifying solutions to help meet surgeons’ varying needs. We are excited about the addition of Recothrom to help surgeons address less severe intraoperative bleeding and Preveleak to complement Baxter’s existing portfolio of sealants for cardiovascular and other surgical specialties,” Baxter advanced surgery prez Wil Boren said in a prepared statement.
Sales of both products totaled approximately $56 million during the 12 months preceding September 29, 2017, and Baxter said it expects the deal to be modestly accretive to its 2018 adjusted earnings and increasingly accretive afterwards.
Baxter said it will pay an initial $153 million upfront and that the deal comes with potential contingent payments in the future.
“Mallinckrodt is transforming itself to become a top-performing specialty pharmaceutical company. We’re increasing our focus on innovative medicines and therapies like terlipressin and StrataGraft, and recently acquired products stannsoporfin, xenon gas and OCR-002 – as well as, at the potential close of the Sucampo acquisition, VTS-270 and CPP-1X – that can make a real difference in patient populations with very high unmet medical needs. With this evolving emphasis on a development portfolio of treatments for seriously ill infants and adults, these hemostasis products are now less strategic for us. Mallinckrodt will continue to proactively shape and refine its Specialty Brands segment. Our long-term objective is to build a diversified specialty pharmaceuticals business focused on both commercialized and pipeline products for patients with severe and critical conditions. We are creating a rich development portfolio of innovative, cutting-edge new treatments and plan to bring them successfully to market. When products become non-core or can potentially better flourish in the hands of others, we will divest them – freeing us to acquire and focus on products more closely aligned with our long-range strategic growth goals,” Mallinckrodt prez & CEO Mark Trudeau said in a press release.
