Valeant to acquire Lithuanian generics firm Sanitas for around 314 million euros

Canada’s Valeant Pharmaceuticals International (TSX: VRX), which was recently spurned in its $5.7 billion bid for USA-based Cephalon, which was snapped up by Teva for $6.8 billion (The Pharma Letter May 3), today announced that it has agreed to acquire Lithuania-based generics drugmaker AB Sanitas (Nasdaq OMX: SAN1L) for about 314 million euros ($444.4 million).

The major shareholders of Sanitas have agreed to sell Valeant 87.2% of the outstanding shares of the firm, with at least 82.6% of the outstanding shares required to be delivered at closing. After the acquisition of this controlling block of shares, Valeant would commence a mandatory tender offer to acquire the remaining minority interest. The total purchase price is expected to be around 314 million euros in cash, in addition to the assumption of approximately 50 million euros in debt. The exact purchase price shall be calculated and announced at closing.

Sanitas, a publicly-traded specialty pharmaceuticals company based in Kaunas, Lithuania, has a broad branded generics product portfolio consisting of 390 products in nine countries throughout Central and Eastern Europe, primarily Poland, Russia and Lithuania. Sanitas has in-house development capabilities in dermatology, ophthalmology and hospital injectables and a robust pipeline of internally developed and acquired dossiers. Annual revenues for Sanitas are expected to be over 100 million euros in 2011, with a revenue growth rate in the low double digits over the coming years.