Aytu acquisition of Innovus : Colorado-based specialty pharma company Aytu BioScience has agreed to acquire Innovus Pharmaceuticals in a deal worth up to $24 million, as per the latest pharma acquisition news.
Headquartered in California, Innovus Pharmaceuticals is an over the counter (OTC) consumer goods and specialty pharmaceutical company.
On the other hand, Aytu BioScience is engaged in commercializing novel drugs that address significant patient needs.
Under the terms of Aytu acquisition of Innovus, the former will retire all outstanding common stock of the latter for a total of up to $8 million in the form of its shares at the time of closing.
The initial consideration to Innovus’ shareholders is estimated to consist of nearly 4.2 million shares of Aytu. An additional consideration for up to $16 million will be paid to Innovus in milestone payments in the form of contingent value rights (CVRs) in either cash or stock in the next five years if some revenue and profitability milestones are met.
Innovus reported $24 million-plus in revenue in the four quarters ending 30 June 2019.
Aytu acquisition of Innovus will enable the former to expand into the $40 billion consumer healthcare market courtesy of a portfolio of more than 30 consumer products across therapeutic categories such as diabetes, men’s health, respiratory health, and sexual wellness.
Commenting on Aytu acquisition of Innovus, Josh Disbrow – CEO of Aytu BioScience said: “Over the past two years, significant investment has been made in the areas of consumer wellness, telemedicine, and online health, so it’s the right time for Aytu to enter this high-growth market.
“Further, consumers are increasingly taking control over their healthcare decisions and, particularly for common conditions, over 90% of the time patients are self-treating with over-the-counter options in advance of receiving care from a prescriber.
“By adding a consumer unit to Aytu’s already growing prescription business, we increase our exposure to the broader patient market while continuing to grow our portfolio of novel prescription products.”
The expanded product line grows Aytu’s portfolio beyond prescription therapeutics to pave way for greater revenue distribution, lowered seasonality associated with its seasonal antitussive product line, and increased revenue from an enlarged base of proprietary products.
The combination of Aytu and Innovus would have registered $31 million-plus revenue over the preceding four quarters ending 30 June 2019.
Dr. Bassam Damaj – President and CEO of Innovus Pharmaceuticals, commenting on Aytu acquisition of Innovus, said: “We are looking forward to helping build Aytu into a world-class healthcare company, and I’m personally excited about continuing on as the President of the Aytu Consumer Health business unit.
“With the combined strength of our companies, we believe we can more rapidly grow our novel OTC medicines and supplements while developing additional consumer healthcare products as we grow, thus adding value to the newly-expanded Aytu BioScience.”
Aytu acquisition of Innovus, which is likely to be wrapped up as early as the year-end, will be subject to regulatory approvals and customary closing conditions, as per the latest pharma acquisition news.