Pernix Therapeutics Holdings, Inc. (“Pernix” or the “Company”) (NYSE MKT: PTX), a specialty pharmaceutical company, today announced that it has entered into a definitive agreement to acquire Cypress Pharmaceuticals, Inc. (“Cypress”), a privately-owned generic pharmaceutical company, and Hawthorn Pharmaceuticals, Inc. (“Hawthorn”), a privately-owned branded pharmaceutical company.
Under the terms of the agreement, Pernix will pay approximately $101 million, which includes an up-front payment of $68.5 million in cash and $12.5 million in equity, $10 million payable in December 2013, and an additional $10 million in milestone payments. The Company has received a commitment of a $60 million credit facility. MidCap Financial will serve as Sole Bookrunner, Administrative Agent and Joint Lead Arranger.
Cypress and Hawthorn, founded in 1993, are headquartered in Madison, MS and have 170 employees, including 115 sales reps. In 2012, revenues for Cypress and Hawthorn are expected to be approximately $50 million, consisting of approximately 54% generic products and 46% branded products. Hawthorn offers a wide array of branded pharmaceutical products, including allergy, respiratory, iron deficiency, nephrology and pain management. Cypress offers a broad range of generic pharmaceutical products in the areas of cough and cold, nutritional supplements, analgesics, urinary tract, women’s health, pre-natal vitamins and dental health.
This acquisition is expected to significantly increase and broaden Pernix’s branded and generic product portfolio. Cypress and Hawthorn also have clinical and regulatory expertise, receiving approval of more than 10 ANDAs in the last three years and 2 NDAs in 2011. Additionally, 15 ANDAs and one 505(b)(2) NDA were filed at the FDA, and Cypress and Hawthorn also have several products in clinical development.Cooper Collins, President and CEO of Pernix, said, “This will be the most significant acquisition in the Company’s history. The generic and branded businesses of Cypress and Hawthorn are an excellent fit for Pernix, which is expected to increase the Company’s revenues for the full year 2013 to approximately $135-$145 million. The Cypress and Hawthorn pipeline, which includes products filed with the FDA or in development, will move us forward on our strategic plan to drive the Company’s future success. We are enthusiastic about working with the Cypress and Hawthorn’s management team as we integrate our companies. We are confident that Pernix, Cypress and Hawthorn are an excellent combination that will provide strong growth in the future.”
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