With this deal, India’s largest drug maker will get Concert’s lead product candidate deuruxolitinib, which is in late-stage development for the treatment of alopecia areata, or sudden hair loss causing baldness, an autoimmune skin disease.
Sun Pharma said its immediate focus would be to follow Concert’s plan to submit a New Drug Application (NDA) to the US Food and Drug Administration (FDA) in the first half of 2023. As per the agreement, Sun Pharma will acquire all outstanding shares of Concert through a tender offer for an upfront payment of $8 per share of common stock in cash, or $576 million in equity value.
The upfront payment of $8 per share represents a premium of approximately 33% to Concert’s 30-day volume weighted average price as of January 18, 2023, the last trading day prior to the announcement.
Concert stockholders will also receive a non-tradeable contingent value right (CVR), entitling them to receive up to an additional $3.50 per share of common stock in cash, payable upon deuruxolitinib achieving certain net sales milestones within specified periods, subject to terms and conditions contained in a contingent value rights agreement.
The transaction, approved by the boards of both companies, is expected to be completed in the first quarter of 2023. It is subject to the tender of a majority of the outstanding shares of Concert’s common stock, as well as the receipt of applicable regulatory approvals and other customary closing conditions.
For the nine-month period ended September 2022, Concert had reported total revenue of $29,000 and a net loss of $90.6 million. The R&D expense for that nine-month period was $75.7 million. As of September 30, 2022, Concert had approximately $148.9 million in cash, cash equivalents, and investments.Sun Pharma had net cash of $1.6 billion as of September 30, 2022.
The deal strengthens Sun Pharma’s global dermatology franchise by adding a late-stage product in an area with significant unmet need. Concert will leverage Sun Pharma’s global infrastructure to provide broad access to deuruxolitinib for patients with alopecia areata.
Concert has pioneered the use of deuterium (a hydrogen isotope) in medicinal chemistry and has an extensive patent portfolio, including its lead product candidate deuruxolitinib – an oral inhibitor that blocks Janus kinases JAK1 and JAK2 for the treatment of baldness. Concert has completed the evaluation of the efficacy and safety of deuruxolitinib in adult patients with moderate to severe alopecia areata in its THRIVE-AA Phase 3 clinical program and two open label, long-term extension studies are ongoing in North America and Europe.