Valeant on the prowl again, with bid to buy Medicis for about $2.6 billion

In a sixth acquisition so far this year, as well as several takeovers the previous year, Canada’s Valeant Pharmaceuticals International (TSX: VRX) has entered into a definitive agreement to buy all the outstanding common stock of USA-based dermatological drug specialist Medicis Pharmaceutical (NYSE: MRX) for $44.00 per share in cash, a transaction value of around $2.6 billion, which was unanimously approved by the boards of directors of both companies.

The $44.00 per share price represents a 39% premium to Medicis' closing share price on Friday, August 31, the last trading day prior to the announcement late yesterday, and a 31% premium to Medicis’ three-month average trading price. The transaction, the biggest for Valeant since a failed $5.7 billion bid to acquire US specialty drugmaker Cephalon last year – which fell into the hands of Israel’ Teva Pharmaceutical with a $6.8 billion offer (The Pharma Letter May 3, 2011), is expected to close in the first half of 2013. Including the Medicis deal, so far this year Valeant's acquisitions have totaled more than $3.5 billion.

Medicis' pro forma net revenue for the combined company's dermatology and aesthetics businesses for 2012 is expected to exceed $1.7 billion within the USA, said Valeant. The acquisition includes Medicis drugs such as Solodyn (minocycline) and Dysport (abobotulinumtoxinA).