Lundbeck to Acquire Longboard Pharmaceuticals in a Strategic Deal, Significantly Enhancing Its Neuroscience Pipeline
Lundbeck will acquire Longboard Pharmaceuticals in a strategic deal to enhance its neuroscience pipeline. The acquisition, valued at approximately USD 2.6 billion equity value and USD 2.5 billion net of cash, will add the innovative product bexicaserin, in late-stage development for Developmental and Epileptic Encephalopathies (DEEs). Bexicaserin, targeting 5-HT2C receptors, has shown promising anti-seizure effects in preclinical and clinical studies. A global phase III trial, DEEp SEA, began in September 2024. Lundbeck will fund the acquisition through existing cash resources and bank financing. The deal, approved by both companies' boards, is expected to close in Q4 2024, subject to regulatory approvals. The acquisition aligns with Lundbeck's Focused Innovator strategy and aims to address unmet needs in neuro-rare conditions, potentially driving growth into the next decade.
Lundbeck acquisirà Longboard Pharmaceuticals in un'affare strategico per potenziare il proprio portafoglio nel campo delle neuroscienze. L'acquisizione, valutata circa 2,6 miliardi di USD in valore azionario e 2,5 miliardi di USD al netto della liquidità, includerà il prodotto innovativo bexicaserin, attualmente in fase avanzata di sviluppo per le Encefalopatie Sviluppative ed Epilettiche (DEEs). Bexicaserin, che agisce sui recettori 5-HT2C, ha mostrato effetti promettenti contro le crisi epilettiche in studi preclinici e clinici. Un trial globale di fase III, DEEp SEA, è iniziato a settembre 2024. Lundbeck finanzierà l'acquisizione attraverso risorse di liquidità esistenti e finanziamenti bancari. L'affare, approvato dai consigli di amministrazione di entrambe le società, dovrebbe concludersi nel quarto trimestre del 2024, soggetto ad approvazioni regolatorie. L'acquisizione si allinea con la strategia di Lundbeck come Innovatore Focalizzato e mira a soddisfare esigenze non soddisfatte in condizioni neuro-rare, con il potenziale di stimolare la crescita nel prossimo decennio.
Lundbeck adquirirá Longboard Pharmaceuticals en un acuerdo estratégico para mejorar su cartera en neurociencias. La adquisición, valorada en aproximadamente 2,6 mil millones de USD en valor de capital y 2,5 mil millones de USD netos de efectivo, añadirá el producto innovador bexicaserin, que se encuentra en desarrollo avanzado para las Encefalopatías del Desarrollo y Epilépticas (DEEs). Bexicaserin, que tiene como objetivo los receptores 5-HT2C, ha demostrado efectos prometedores contra las convulsiones en estudios preclínicos y clínicos. Un ensayo global de fase III, DEEp SEA, comenzó en septiembre de 2024. Lundbeck financiará la adquisición a través de recursos de efectivo existentes y financiación bancaria. El acuerdo, aprobado por los consejos de ambas compañías, se espera que se cierre en el cuarto trimestre de 2024, sujeto a las aprobaciones regulatorias. La adquisición se alinea con la estrategia de Innovador Enfocado de Lundbeck y tiene como objetivo abordar necesidades no satisfechas en condiciones neuro-raras, potencialmente impulsando el crecimiento en la próxima década.
룬드벡이 롱보드 제약을 인수하여 신경과학 파이프라인을 강화하는 전략적 거래를 진행합니다. 약 26억 달러의 자본 가치와 25억 달러의 현금을 제외한 인수가는 혁신적인 신약 벡시카세린을 포함하며, 이는 발달 및 간질성 뇌병증 (DEEs) 치료를 위한 후기 단계 개발 중에 있습니다. 5-HT2C 수용체를 표적하는 벡시카세린은 전임상 및 임상 연구에서 유망한 항경련 효과를 보였습니다. 전 세계 임상 3상 시험인 DEEp SEA가 2024년 9월에 시작되었습니다. 룬드벡은 기존 현금 자원과 은행 대출을 통해 인수를 자금 지원할 예정입니다. 두 회사 이사회에서 승인을 받은 이 거래는 규제 승인을 받을 경우 2024년 4분기에 마무리될 것으로 예상됩니다. 이번 인수는 룬드벡의 집중 혁신자 전략과 일치하며, 신경 희귀 질환의 미충족 니즈를 해결하는 것을 목표로 하여 다음 10년 동안의 성장을 촉진할 잠재력이 있습니다.
Lundbeck va acquérir Longboard Pharmaceuticals dans le cadre d'un accord stratégique visant à renforcer son portefeuille en neurosciences. L'acquisition, évaluée à environ 2,6 milliards de USD en valeur d'équité et 2,5 milliards de USD nets de liquidités, permettra d'ajouter le produit innovant bexicaserin, en développement avancé pour les Encéphalopathies Développementales et Épileptiques (DEEs). Le bexicaserin, qui cible les récepteurs 5-HT2C, a montré des effets prometteurs anti-crise dans des études précliniques et cliniques. Un essai mondial de phase III, DEEp SEA, a commencé en septembre 2024. Lundbeck financera l'acquisition grâce à des ressources de liquidités existantes et à un financement bancaire. L'accord, approuvé par les conseils des deux entreprises, devrait être finalisé au quatrième trimestre 2024, sous réserve des approbations réglementaires. L'acquisition s'inscrit dans la stratégie d'Innovateur Focalisé de Lundbeck et vise à répondre à des besoins non satisfaits dans les conditions neuro-rares, avec un potentiel de croissance dans la prochaine décennie.
Lundbeck wird Longboard Pharmaceuticals in einem strategischen Deal übernehmen, um seine Neurorwissenschaften-Pipeline zu erweitern. Die Akquisition, die mit etwa 2,6 Milliarden USD Eigenkapital und 2,5 Milliarden USD nach Abzug von Bargeld bewertet wird, wird das innovative Produkt bexicaserin hinzufügen, das sich in der späten Entwicklungsphase für Entwicklungs- und Epileptische Enzephalopathien (DEEs) befindet. Bexicaserin zielt auf 5-HT2C-Rezeptoren ab und hat in präklinischen und klinischen Studien vielversprechende antikonvulsive Effekte gezeigt. Eine globale Phase-III-Studie, DEEp SEA, begann im September 2024. Lundbeck wird die Akquisition durch bestehende Liquiditätsressourcen und Bankfinanzierung finanzieren. Der Deal, der von den Vorständen beider Unternehmen genehmigt wurde, soll im vierten Quartal 2024 abgeschlossen werden, vorbehaltlich der Zustimmung der Aufsichtsbehörden. Die Akquisition steht im Einklang mit Lundbecks Strategie als Fokussierter Innovator und zielt darauf ab, unerfüllte Bedürfnisse bei neuro-seltener Krankheiten anzugehen, was potenziell zu einem Wachstum im nächsten Jahrzehnt führen könnte.
- Acquisition valued at USD 2.6 billion equity value and USD 2.5 billion net of cash.
- Addition of bexicaserin, with blockbuster potential, to Lundbeck's pipeline.
- Global phase III trial for bexicaserin initiated.
- Potential revenue growth from DEEs treatment market.
- Strategic alignment with Lundbeck's Focused Innovator strategy.
- USD 80 million integration costs impacting 2024 Adjusted EBITDA.
- Funding through existing cash resources and bank financing may affect leverage.
Insights
This acquisition is a significant strategic move for Lundbeck, substantially enhancing its neuroscience pipeline and positioning in the rare epilepsy market. The
Key financial implications:
- Premium of
77% over Longboard's 30-day VWAP, indicating Lundbeck's strong belief in the asset's value - Funding through existing cash and bank financing, with a focus on de-leveraging post-acquisition
- Expected integration costs of
$80 million , primarily impacting 2024 - Potential launch in Q4 2028, diversifying Lundbeck's revenue streams
This deal aligns with Lundbeck's Focused Innovator strategy and could drive growth into the next decade. However, investors should monitor the progress of the phase III trial and potential regulatory hurdles.
Bexicaserin represents a significant advancement in DEE treatment, targeting an area of high unmet medical need. As a 5-HT2C receptor superagonist, it offers a novel mechanism of action with potential advantages over existing therapies:
- Breakthrough Therapy Designation from the FDA, indicating its potential to address a serious condition and preliminary clinical evidence of substantial improvement over available therapies
- Broad applicability across various DEE syndromes, including Dravet and Lennox-Gastaut
- Encouraging anti-seizure effects in preclinical and clinical studies
- Ongoing global phase III trial (DEEp SEA) for Dravet syndrome
The acquisition could accelerate bexicaserin's development and potentially bring a transformative treatment to market. However, as with any late-stage drug development, there are still risks associated with the ongoing clinical trials and regulatory approval process.
- The proposed acquisition represents a significant step forward in Lundbeck’s Focused Innovator strategy, adding a highly innovative and complementary product in late-stage development for Developmental and Epileptic Encephalopathies (DEEs) - an area of high unmet medical need
- The acquisition will enhance and complement Lundbeck’s capabilities and presence within neuro-rare conditions
- The lead asset, bexicaserin, holds blockbuster potential and is in development for the treatment of DEEs in a program enrolling patients diagnosed with Dravet syndrome, Lennox-Gastaut syndrome, and other DEE syndromes
- Bexicaserin has shown encouraging anti-seizure effects to date in preclinical and clinical studies, with its next-generation superagonist mechanism specifically targeting 5-HT2C receptors, supporting bexicaserin’s potential to offer a highly differentiated and best-in-class profile
- A global phase III trial (DEEp SEA) evaluating bexicaserin for the treatment of seizures associated with Dravet syndrome was initiated in September 2024
-
Total transaction value of approximately
USD 2.6 billion equity value andUSD 2.5 billion net of cash (approximatelyDKK 17 billion ). Funding will be through existing cash resources and bank financing
VALBY,
The board of directors of both companies have unanimously approved the transaction. The transaction is expected to close in the fourth quarter of 2024, subject to the tender of at least a majority of the total number of Longboard outstanding voting shares, receipt of required regulatory clearances, and other customary conditions.
Longboard is a clinical-stage biopharmaceutical company focused on developing novel, transformative medicines for neurological diseases. Its lead asset, bexicaserin, has shown encouraging anti-seizure reduction to date in preclinical and clinical studies, with its next-generation superagonist mechanism specifically targeting 5-HT2C receptors, which support bexicaserin’s potential to offer a highly differentiated and best-in-class profile. Bexicaserin is now being evaluated in a global phase III clinical program (the DEEp Program).
“This transformative transaction will become a cornerstone in Lundbeck’s neuro-rare franchise, with a potential to drive growth into the next decade. Bexicaserin addresses a critical unmet need for patients suffering from rare and severe epilepsies, for which there are very few good treatment options available. With this acquisition, we continue to execute on our Focused Innovator strategy, transforming the lives of patients suffering from severe brain disorders,” said Charl van Zyl, President and CEO of Lundbeck.
“Longboard was founded to transform the lives of people living with devastating neurological conditions. I am incredibly proud of what our team has achieved; delivering groundbreaking data with a differentiated and inclusive clinical approach to address the needs of a wide range of DEEs and obtaining Breakthrough Therapy designation,” stated Kevin R. Lind, President and Chief Executive Officer of Longboard. “I would like to thank the entire DEE community, in particular bexicaserin’s study participants and their caregivers as well as the advocacy groups, investigators, sites and coordinators for their support and partnership. Lundbeck’s remarkable capabilities will accelerate our vision to provide increased equity and access for underserved DEE patients with significant unmet medical needs.”
Strategic benefits
The acquisition of Longboard marks a strategic milestone for Lundbeck, enhancing and complementing our Focused Innovator strategy and advancing our goal of building a neuro-rare disease franchise.
Through the acquisition of Longboard, Lundbeck gains access to bexicaserin, a novel 5-HT2C agonist in development for the treatment of seizures associated with DEEs, including Dravet syndrome, Lennox-Gastaut syndrome, and other rare epilepsies. This aligns with Lundbeck’s expertise in delivering innovative treatments and re-establishes our scientific and commercial leadership in rare epilepsies. Bexicaserin has entered a global phase III trial (DEEp SEA Study) evaluating bexicaserin for the treatment of seizures associated with Dravet syndrome in participants two years of age and older. The DEEp SEA Study is part of a broader DEEp Program (DEEp SEA, DEEp OCEAN and DEEp OLE) which is planned to take place across ~80 sites globally and include ~480 participants with a range of DEEs. Bexicaserin has received Breakthrough Therapy Designation (BTD) from the
The bexicaserin asset complements Lundbeck’s mid- to late-stage pipeline and diversifies revenue growth following the expected launch in the fourth quarter of 2028 and with a global peak sales potential estimated by Lundbeck between
Terms, closing conditions and financing
Under the terms of the agreement, Lundbeck will commence a tender offer for all outstanding shares of Longboard common stock, whereby Longboard shareholders will be offered a payment for
If the tender offer is consummated, Lundbeck will acquire any shares of Longboard common stock not tendered into the tender offer through a merger for the same per share consideration as will be payable in the tender offer. The merger will occur as soon as practicable after the closing of the tender offer.
Lundbeck expects to fund the acquisition through existing cash resources and its existing bank financing facility. Following closing of the transaction, Lundbeck will focus on de-leveraging and leverage is expected to be in Lundbeck’s target range of <2.5x NIBD/EBITDA within 18-24 months.
The terms and conditions of the tender offer will be described in the tender offer documents, which will be filed with the
We expect to recognize integration costs in the amount of approximately
Advisors
For Lundbeck, PJT Partners LP is acting as exclusive financial advisor and Baker McKenzie is acting as legal advisor in this transaction. For Longboard, Evercore and Centerview Partners LLC are acting as financial advisors and Cooley LLP is acting as legal advisor.
Conference Call
Today at 13:30 pm (CET), Lundbeck will be hosting a conference call for the financial community. To participate in the conference call please follow the instructions below
Webcast streaming link: Conference call
Teleconference registration link: Teleconference registration
About the DEEp SEA Study
The DEEp SEA Study (LP352-302) is a global phase III double-blind, placebo-controlled clinical trial to evaluate the efficacy of bexicaserin in Dravet syndrome as assessed by countable motor seizures in ~160 participants between the ages of two and 65 years old. An important secondary objective is to evaluate the safety and tolerability of bexicaserin. Following a 5-week screening period and baseline evaluations, study participants initiate dose titration over a 3-week period and subsequently continue on the highest tolerated dose throughout the maintenance period of 12-weeks. Following the maintenance period, eligible participants will be given the opportunity to enroll in the 52-week DEEp Open-Label Extension (DEEp OLE Study LP352-303). The phase III DEEp SEA Study is part of the broader DEEp Program which will take place across ~80 sites globally and include ~480 participants with a range of Developmental and Epileptic Encephalopathies (DEEs).
About Developmental and Epileptic Encephalopathies (DEEs)
Epilepsy is the third leading contributor to the global burden of neurological disorders and affects 65 million people worldwide. DEEs are a group of severe early-childhood onset epilepsies characterized by refractory seizures and developmental delay and/or regression. These diseases are often progressive and commonly show resistance to treatment. DEEs encompass a diverse range of over 25 syndromes, of which only four currently have FDA-approved therapies with partial treatment responses. Consequently, there is a remaining significant unmet need to find therapies that efficiently act across the DEE spectra. Some common epilepsy syndromes that are DEEs include:
- Dravet syndrome
- Lennox-Gastaut syndrome
- Tuberous sclerosis complex
- CDKL5 deficiency disorder
- Early infantile epileptic encephalopathy, including Ohtahara syndrome and early myoclonic encephalopathy
- Infantile epileptic spasms syndrome, including West syndrome
- Febrile infection-related epilepsy syndrome
- Epilepsy of infancy with migrating focal seizures
- Epilepsy with myoclonic-atonic seizures, otherwise known as myoclonic-atonic epilepsy (MAE) or Doose syndrome.
- Landau-Kleffner syndrome
- Developmental and epileptic encephalopathy with spike and wave activation in sleep (DEE-SWAS)
While these syndromes are individually considered an orphan disease, altogether we estimate approximately 220,000 patients are affected by DEE syndromes in the
About Longboard Pharmaceuticals
Longboard is a clinical-stage biopharmaceutical company focused on developing novel, transformative medicines for neurological diseases. Longboard’s small molecule product candidates are based on more than 20 years of GPCR research. Bexicaserin (LP352), an oral, centrally acting 5-hydroxytryptamine 2C (5-HT2C) receptor super-agonist, with no observed impact on 5-HT2B and 5-HT2A receptor subtypes, is being evaluated in a global phase III clinical program (the DEEp Program). Bexicaserin has Rare Pediatric Disease and Orphan Drug designations, and the FDA has granted Breakthrough Therapy designation for bexicaserin for the treatment of seizures associated with Developmental and Epileptic Encephalopathies (DEEs) for patients two years of age and older.
Bexicaserin is an investigational compound that is not approved for marketing by the FDA or any other regulatory authority.
About H. Lundbeck A/S
Lundbeck is a biopharmaceutical company focusing exclusively on brain health. With more than 70 years of experience in neuroscience, we are committed to improving the lives of people with neurological and psychiatric diseases.
Brain disorders affect a large part of the world’s population, and the effects are felt throughout society. With the rapidly improving understanding of the biology of the brain, we hold ourselves accountable for advancing brain health by curiously exploring new opportunities for treatments.
As a focused innovator, we strive for our research and development programs to tackle some of the most complex neurological challenges. We develop transformative medicines targeting people for whom there are few or no treatments available, expanding into neuro-specialty and neuro-rare from our strong legacy within psychiatry and neurology.
We are committed to fighting stigma and we act to improve health equity. We strive to create long term value for our shareholders by making a positive contribution to patients, their families and society as a whole.
Lundbeck has approximately 5,500 employees in more than 50 countries and our products are available in more than 80 countries. For additional information, we encourage you to visit our corporate site www.lundbeck.com and connect with us via LinkedIn.
IMPORTANT INFORMATION FOR INVESTORS AND SECURITY HOLDERS
The tender offer (the Offer) for the outstanding common stock of Longboard referred to in this corporate release has not yet commenced. The description contained in this corporate release is neither an offer to purchase nor a solicitation of an offer to sell any securities, nor is it a substitute for the tender offer materials that Lundbeck and its acquisition subsidiary will file with the
The offer to purchase, the related letter of transmittal and the solicitation/recommendation statement will be made available for free at the SEC’s website at www.sec.gov. Free copies of the offer to purchase, the related letter of transmittal and certain other offering documents will be made available by Lundbeck and when available may be obtained by directing a request to the Information Agent for the tender offer which will be named in the Schedule TO. Copies of the documents filed with the SEC by Longboard’s will be available free of charge on Longboard’s internet website https://ir.longboardpharma.com/financial-information/sec-filings or by contacting Longboard’s investor relations contact at IR@LongboardPharma.com.
In addition to the offer to purchase, the related letter of transmittal and certain other tender offer documents filed by Lundbeck, as well as the solicitation/recommendation statement filed by Longboard, Longboard will also file annual, quarterly and current reports with the SEC. You may read and copy any reports or other information filed by Lundbeck or Longboard at the SEC public reference room at 100 F Street, N.E.,
Safe Harbor/Forward-Looking Statements
This corporate release contains forward-looking statements that provide our expectations or forecasts of future events such as new product introductions, product approvals and financial performance. Forward looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain words like "believe", "anticipate", "expect", "estimate", "intend", "plan", "project", "will be", "will continue", "will result", "could", "may", "might", or any variations of such words or other words with similar meanings. All statements other than statements of historical facts included in this corporate release, including, without limitation, those regarding Lundbeck and Longboard’s financial position, business strategy, plans and objectives of management for future operations (including development plans and objectives relating to Lundbeck and Longboard’s products), are forward looking statements.
Such forward looking statements involve known and unknown risks, uncertainties and other factors which may cause Lundbeck and Longboard's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward looking statements. Factors that may affect future results include, among others, interest rate and currency exchange rate fluctuations; delay or failure of development projects, production or distribution problems; unexpected contract breaches or terminations; government-mandated or market-driven price decreases for Lundbeck's products; introduction of competing products; Lundbeck's ability to successfully market both new and existing products; exposure to product liability and other lawsuits; changes in reimbursement rules and governmental laws and related interpretation thereof; and unexpected growth in costs and expenses. Additional risks and uncertainties include, but are not limited to, risks related to Lundbeck’s ability to complete the transaction on the proposed terms and schedule; whether the tender offer conditions will be satisfied; whether sufficient stockholders of Longboard tender their shares in the transaction; the outcome of legal proceedings that may be instituted against Longboard and/or others relating to the transaction; the failure to receive (or delay in receiving) the required regulatory approvals relating to the transaction; the possibility that competing offers will be made; risks associated with acquisitions, such as the risk that the businesses will not be integrated successfully, that such integration may be more difficult, time-consuming or costly than expected or that the expected benefits of the transaction will not occur; risks related to future opportunities and plans for Longboard and its products, including uncertainty of the expected financial performance of Longboard and its products; disruption from the proposed transaction, making it more difficult to conduct business as usual or maintain relationships with customers, employees or suppliers; the occurrence of any event, change or other circumstance that could give rise to the termination of the acquisition agreement; and other uncertainties pertaining to the business of Longboard, including those detailed in Longboard’s public filings with the SEC from time to time, including Longboard’s most recent Annual Report on Form 10-K for the year ended December 31, 2023 and its subsequent Quarterly Reports on Form 10-Q. The reader is cautioned not to unduly rely on these forward-looking statements. The forward-looking statements in this corporate release and any oral presentations speak only as at the date of this corporate release. Longboard and Lundbeck disclaim any intent or obligation to update or revise these forward-looking statements, or to confirm such statements to reflect subsequent events or circumstances after the date of the corporate release or in relation to actual results, other than as may be required under applicable law or applicable stock exchange regulations.
Certain assumptions made by Lundbeck are required by Danish Securities Law for full disclosure of material corporate information. Some assumptions, including assumptions relating to sales associated with products that are prescribed for unapproved uses, are made considering past performances of other similar drugs for similar disease states or past performance of the same drug in other regions where the product is currently marketed. It is important to note that although physicians may, as part of their freedom to practice medicine in the US, prescribe approved drugs for any use they deem appropriate, including unapproved uses, at Lundbeck, promotion of unapproved uses is strictly prohibited.
View source version on businesswire.com: https://www.businesswire.com/news/home/20241013952344/en/
Lundbeck Contacts
Palle Holm Olesen
Vice President, Investor Relations
PALO@lundbeck.com
+45 30 83 24 26
Thomas Mikkel Mortensen
Media Relations Lead, Corp. Communication
THMR@lundbeck.com
+45 30 83 30 24
Longboard Pharmaceuticals Contact
Megan E. Knight
Vice President, Head of Investor Relations
IR@longboardpharma.com
+1 858.789.9283
Source: Longboard Pharmaceuticals, Inc.
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