The FINANCIAL — Eli Lilly and Company (NYSE: LLY) on November 8 announced that it has signed a definitive merger agreement to acquire Avid Radiopharmaceuticals, Inc., a privately held company developing novel molecular imaging compounds intended for the detection and monitoring of chronic human diseases.
"Avid's lead program in development is florbetapir F 18 (18F-AV-45), a molecular imaging agent under investigation for detecting the presence of amyloid plaque in the brain. Beta-amyloid plaque is a defining pathology of Alzheimer's disease. A marketing application for florbetapir has recently been submitted to the U.S. Food and Drug Administration (FDA). The acquisition of Avid also provides Lilly with a diagnostics development platform covering several disease areas, including Parkinson's disease and diabetes," Lilly informs.
"The acquisition of Avid Radiopharmaceuticals aligns well with Lilly's innovation-based strategy, offers a potential near-term revenue opportunity, leverages our neuroscience expertise and will immediately bolster our diagnostics capabilities," said John Lechleiter, Ph.D., Lilly chairman and chief executive officer. "We look forward to partnering with Avid's experts during the regulatory process for florbetapir, and are intent on gaining FDA approval for this promising diagnostic intended to help clinicians and researchers identify the presence of beta-amyloid plaque in the brain."
"We are very excited to join the great scientific team at Lilly and continue our work to develop new molecular imaging agents capable of changing the medical management of significant chronic human diseases," said Daniel M. Skovronsky, M.D., Ph.D., Avid's founder and chief executive officer. "We've had a productive and long-standing relationship with Lilly, and believe in their approach to providing improved outcomes for individual patients."
Under the terms of the agreement, Lilly will acquire all outstanding shares of Avid for an upfront payment of $300 million, subject to adjustment based on existing cash on hand at closing. Avid stockholders will also be eligible for up to $500 million in additional payments contingent upon potential future regulatory and commercial milestones for florbetapir. Upon completion of the acquisition, Avid will continue to operate from its facility in Philadelphia, Pennsylvania. Avid will provide uninterrupted support for ongoing academic clinical trials, including the Alzheimer's Disease Neuroimaging Initiative (ADNI), as well as ongoing clinical trials for other pharmaceutical companies. The transaction is contingent upon clearance under the Hart-Scott-Rodino Antitrust Improvements Act and other customary closing conditions, including requisite approval of Avid stockholders. Barclays Capital served as exclusive financial advisor to Lilly, while Morgan Stanley & Co. Incorporated served as exclusive financial advisor to Avid.
"The acquisition of Avid supports our efforts to provide patients and physicians with diagnostics that enable speed of intervention, improve diagnosis accuracy and inform therapeutic choice," said Tiffany Olson, Lilly's vice president of diagnostics research and development. "In addition to florbetapir, we look forward to supporting the continued clinical development of Avid's earlier-phase diagnostics pipeline."
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