A Japanese drugmaker plans to acquire several companies from Vivek Ramaswamy’s Vant family of firms under a new alliance between the two.
Basel, Switzerland-based Roivant Sciences and Osaka, Japan-based Sumitomo Dainippon Pharma said Thursday that they had formed the Sumitomo Dainippon-Roivant Alliance, comprising up to 11 Vant companies and 25 programs under clinical development with potential launches between 2020 and 2022. As part of the deal, Sumitomo will buy five Vants, take a 10 percent equity stake in Roivant and pay the company $3 billion.
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The alliance will be wholly owned by Sumitomo, which is also taking over Myovant Sciences, Urovant Sciences, Enzyvant Therapeutics, Altavant Sciences and an additional company that remains to be specified. Sumitomo will have the option of acquiring another six Vants as well.
Shares of Sumitomo closed up 1.7 percent on the Tokyo Stock Exchange Friday at 1,800 yen ($16.86). Shares of Myovant, which unlike Roivant is publicly traded, were down more than 5 percent on the New York Stock Exchange. Shares of Urovant were down less than 1 percent on the Nasdaq.
Myovant focuses on women’s health and prostate cancer, while Urovant focuses on urinary diseases.
In a note to investors Friday, Cowen analyst Phil Nadeau wrote that the fall in Myovant’s share price appeared to reflect investor concern that Sumitomo’s ownership stake precludes the Vant’s acquisition by any other firm. While such an acquisition would indeed seem unlikely, he wrote that at the company’s current valuation, there is no take-out premium on its stock. Moreover, he wrote, Sumitomo’s ownership stake holds several important benefits for Myovant, the most important of which is that it should provide the company with additional resources and access to commercial infrastructure as it launches the prostate cancer drug relugolix.
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In a statement, Sumitomo CEO Hiroshi Nomura expressed hope that the alliance would allow the company to address issues that it identified in its mid-term business plan for 2018-2022, which it released in April. These issues include establishment of growth engines – particularly given the looming expiration of patent protection for the schizophrenia drug Latuda (lurasidone) – and building an efficient organization. Among the goals described was pipeline expansion through strategic investment.
Sales of generic versions of Latuda are expected to start in February 2023. The drug is Sumitomo’s top-selling product, with sales in the North America market last year of $1.7 billion.
“We respect Roivant’s innovative business model and underlying culture, and we look forward to deepening our relationship with Roivant, which has a rich development pipeline, technology platforms, and distinctive talents,” Nomura said.
Use of digital technology was also identified as a way to achieve new value creation and operational reform. As part of the deal with Roivant, Sumitomo will gain access to Roivant’s drug-development technology, DrugOme, and its Digital Innovation system, which uses technology to improve business processes.
Photo: Lisa Lake, Getty Images
