India’s largest drug company believes it has found the company’s next big drug in Lexington.
Sun Pharmaceutical Industries, which is headquartered in Mumbai and employees 38,000 people worldwide, said Thursday that it would pay $576 million for Concert Pharmaceuticals and the local biotech’s promising hair loss pill, in a move to bolster Sun’s dermatology drug business.
Concert is in the advanced stages of testing its treatment for alopecia areata, a condition that causes a person’s immune system to attack hair follicles, causing patchy or total hair loss. As many as 1 in 40 people may experience the disease in their lifetime.
Last year, Concert said that its drug, deuruxolitinib, restored a nearly full head of hair in about 30 to 40 percent of people in two separate 24-week studies. Longer term studies of the drug are ongoing. Sun Pharma said it plans to submit the pill for approval by the Food and Drug Administration before July.
Sun Pharma said that its purchase of $8 per share was a 33 percent premium over Concert’s average stock price over the last 30 days. But the acquisition comes at a 70 percent discount compared with Concert’s peak price in early 2018, which dropped following clinical and legal setbacks for its other drug development programs. In November, Concert said it only had enough funds to survive through June.
“We are proud to see our team’s accomplishment – creating a valuable new drug candidate for a major, underserved disease – appropriately recognized and valued by Sun Pharma as a means to expand their ongoing, international commitment to dermatology,” Concert chief executive Roger Tung said in a statement, adding that he is confident the acquisition will “enhance access” to the drug.
If the drug is approved, Sun Pharma will face competition from Eli Lilly, whose drug Olumiant won approval for treating moderate to severe alopecia areata last June. And Pfizer submitted its own treatment, ritlecitinib, for the condition to regulators in September. It anticipates a decision from the FDA this spring.
Large drug makers made fewer acquisitions and for smaller sums in 2022 compared with prior years, and biotech leaders are hoping for an uptick in acquisitions to rejuvenate the flagging stocks, many of which have fallen over the past two years.
Concert shareholders could earn an additional $1 per share if sales of the drug exceed $100 million before April 2027 and an addition $2.50 per share if sales of the drug exceed $500 million before the end of 2029.