Dublin-based Shire to acquire Dyax for initial $5.9 billion

Shire estimates that, if approved, DX-2930 could generate as much as $2 billion annually. The additional $646 million payment is contingent on DX-2930 winning approval by the end of 2019.

The Dyax deal is something of a defensive move for Shire, whose own Cinryze and Firazyr are major figures on the HAE market alongside a treatment from Valeant Pharmaceuticals ($VRX).

I’m proud of the company that our team has built, and I’m confident that Dyax’s important mission and focus on improving the lives of patients will continue as part of the Shire family. The new HAE therapy has won fast track, breakthrough therapy and orphan drug designations from the U.S. Food and Drug Administration.

Shire will fund the acquisition, which the companies expect to complete in the first half of 2016, using a $5.6 billion term loan and its $2.1 billion revolving credit facility.

Shares of Shire dropped by around 1% to 4,871 pence in morning trading on the FTSE in London.

The deal will also add Dyax’s already-marketed hereditary angioedema treatment Kalbitor, taken after an attack, to Shire’s portfolio.

In the meantime, it has agreed to offer $37.30 per share for Dyax, or $5.9 billion in total, up front, representing a 35% premium to Dyax’s $27.53 closing price on the Nasdaq on Friday.

DX-2930 has the potential to expand HAE-treated patients and achieve annual worldwide sales of up to $2 billion with exclusivity beyond 2030.

However, Jefferies analysts said that since Dyax was a debt-funded cash deal there was no direct impact on Shire’s ability to do an all-equity Baxalta acquisition.

He added that the deal highlights Dyax’s “shared commitment to bringing innovative medicines to patients who suffer from the devastating effects of HAE” – described in the statement as a “rare, debilitating genetic inflammatory condition”.

At the same time, the Shire chief executive has emphasized he won’t stop pursuing smaller deals while he seeks to acquire Baxalta.

It comes amid a record wave of deal-making in the broader healthcare sector so far this year, which amounted to $477 billion as of last week, according to Thomson Reuters data.

Shire anticipates that it will realize operating synergies of $50 million starting in 2017, growing to at least $100 million in 2019 and thereafter.