Teva Agrees to Buy NuPathe for $144 Million, Outbidding Endo

Jan 21, 2014 4:13 pm ET

(Updates with closing shares in sixth paragraph.)

Jan. 21 (Bloomberg) -- Teva Pharmaceutical Industries Ltd. agreed to buy NuPathe Inc. for $144 million, outbidding Endo Health Solutions Inc. to gain NuPathe’s migraine patch.

NuPathe holders will receive $3.65 a share in cash, Teva said today in a statement. The price is 59 percent above NuPathe’s closing level on Dec. 13, the last trading day before Endo said it had agreed to buy the company. NuPathe holders may collect as much as $3.15 a share in additional payments from Teva if the Zecuity migraine treatment meets sales goals.

The purchase will add to Teva’s lineup of drugs to treat central nervous system illnesses, and the company said it can use NuPathe’s patch technology in other areas. Zecuity uses a battery-powered patch to deliver the treatment through the skin, combating headaches and related nausea. The product was approved in the U.S. in 2013.

“We believe that Zecuity is a great fit within our existing U.S. CNS business unit, with near-term sales and significant commercial potential,” Mike Derkacz, vice president and general manager of Teva’s central nervous system business, said in the statement.

Endo had agreed to pay holders of Malvern, Pennsylvania- based NuPathe $2.85 a share plus additional payments of as much as $3.15 a share. Teva said Jan. 8 it was seeking to outbid Endo.

Teva’s American depositary receipts, each equal to one regular share of the Petach Tikva, Israel-based drugmaker, rose 2.4 percent to close at $45.31 in New York. NuPathe fell 7.5 percent to $4.05 and Endo decreased 1.7 percent to $68.83.

NuPathe paid a $5 million breakup fee to Chadds Ford, Pennsylvania-based Endo to end their agreement, using money lent to it by Teva, NuPathe said in a regulatory filing today. MTS Health Partners LP advised NuPathe on the deal. Teva didn’t disclose an investment bank.

--With assistance from Caroline Chen in New York. Editors: Marthe Fourcade, Bruce Rule