The binding offer consists of an upfront cash payment of €190m and up to €85m in potential earnout payments based on the rare diseases business achieving certain sales milestones
Esteve Healthcare to buy Perrigo's HRA Pharma Rare Diseases Business. (Credit: ESTEVE)
Perrigo, a provider of consumer self-care products, has agreed to divest its HRA Pharma Rare Diseases business to Esteve Healthcare for a total consideration of up to €275m.
Perrigo’s HRA Pharma unit specialises in rare and ultra-rare diseases. The unit made around €50m in annual net revenues in 2023 and has a presence in several European countries and the US.
The binding offer consists of an upfront cash payment of €190m and up to €85m in potential earnout payments based on the rare diseases business achieving certain sales milestones.
Perrigo plans to exercise the put option granted by Esteve and formalise the agreement for the sale of the Rare Diseases business following the consultation process with the HRA Pharma Works Council in France.
The transaction is anticipated to be finalised in Q3 2024, pending approval from the HRA Works Council and customary closing conditions, including regulatory clearance.
Perrigo president and CEO Patrick Lockwood-Taylor said: “Divesting the HRA Pharma Rare Diseases business further supports our position as a leading fast-moving consumer goods company.
“The cash upfront proceeds from this proposed transaction would enable us to reduce net leverage to below 4.0x by the end of 2024.
“We are pleased that ESTEVE, with their successful track record, will benefit from this great business and team.”
Through the acquisition, Esteve Healthcare will increase its portfolio in the rare and severe diseases therapeutic area.
The company will add three new medicines to its portfolio that address Cushing’s syndrome and Adrenocortical Carcinoma: Metopirone, Lysodren, and Ketoconazole HRA.
Esteve Healthcare CEO Staffan Schüberg said: “This transaction aims to advance on the path of covering the unmet patients’ needs, in line with ESTEVE’s purpose of improving people’s lives, and is another step towards the company’s vision of being an international and specialist pharma company.”
Morgan Stanley acted as Perrigo’s financial advisor, with legal counsel provided by Wachtell, Lipton, Rosen & Katz. Esteve has Perella Weinberg Partners as its financial advisor and Clifford Chance as its legal counsel.