Cipla said is US subsidiary has agreed to acquire a US company developing an intravenous formulation of the pain-relief medicine Tramadol for up to $215 million (Rs 1,500 cr).
The transaction will be done in two phases, with a $35 million injection into the company, Avenue Therapeutics, in the form of purchase of new shares for a 33.3% stake, followed by a merger by which the remaining shares in the target company will be acquired for up to $180 million, the Indian pharmaceutical company said.
Oral Tramadol, a centrally acting analgesic, is currently approved and marketed in the U.S. for moderate to moderately severe pain in adults in.
There is currently no approved intravenous formulation in the U.S.
Cipla Global CEO Umang Vohra said the deal was in keeping with the company’s stated aim of building a specialty pipeline in the US market.
“Our investment in and proposed acquisition of Avenue establishes our presence in the specialty institutional business in the US,” he said . “The novel intravenous drug delivery method of Tramadol addresses extremely crucial and hitherto unmet needs in pain management.”
Avenue is evaluating IV Tramadol in a pivotal Phase 3 clinical program: a trial in patients following bunionectomy surgery has been completed and a safety study is ongoing.
“A pivotal Phase 3 trial in patients following abdominoplasty surgery is expected to commence later this year in 2018,” Cipla said.
Lucy Lu, M.D., President & Chief Executive Officer, Avenue, said the deal will accelerate the Phase 3 clinical development and potential commercialization of IV Tramadol in the United States.
“IV Tramadol offers a novel mechanism of action among intravenous analgesics and could be an important new therapy that fills a significant gap in pain management. We believe that this transaction creates significant value for our shareholders and creates a path to maximize their return on investment.”