Valeant to sell Sprout Pharma back to original shareholders

6 November 2017

Beleaguered Canadian firm Valeant Pharmaceuticals International (TSX: VRX) saw its share price edge up 2.8% to $11.49 in pre-market trading, after it announced that it plans to divest another of the assets that it bought over the past few years.

This time round it has agreed to divest its Sprout Pharmaceuticals subsidiary, which it acquired on a debt-free basis, for approximately $1 billion in cash in 2015, in a bid to shore up its financial position.

The Canadian drugmaker has entered into an agreement to divest Sprout to a buyer affiliated with former shareholders of Sprout in exchange for a 6% royalty on global sales of Addyi (flibanserin) beginning 18 months from the signing of the sale agreement. Addyi is the only approved and commercialized product of Sprout.

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