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Depomed Acquires CAMBIAA® (Diclofenac Potassium For Oral Solution) Migraine Medicine From Nautilus Neurosciences For $48.7 Million

NEWARK, Calif., Dec. 17, 2013 /PRNewswire/ -- Depomed, Inc. (NASDAQ: DEPO) today announced that it has acquired the United States rights to CAMBIA® (diclofenac potassium for oral solution) from Nautilus Neurosciences for $48.7 million. In addition, Depomed may pay Nautilus up to an additional $5 million based on the achievement of certain annual net sales milestones. CAMBIA is a non-steroidal anti-inflammatory drug (NSAID) indicated for acute treatment of migraine attacks with or without aura in adults 18 years of age or older.

Benefits of CAMBIA acquisition:
  • Bolsters Depomed's portfolio in pain and neurology, specifically strengthening the company's position with neurologists
  • Secures CAMBIA, the only single agent NSAID in the U.S. specifically indicated for migraine, and immediately increases Depomed's topline with annualized net sales run rate of approximately $18 million over the past 3 months
  • Adds another growth product to Depomed, as CAMBIA total prescriptions in third quarter 2013 were up more than 30 percent over the same quarter last year
  • Creates synergies with Gralise commercial efforts as nearly 70% of CAMBIA prescriptions are written by neurologists and half of these prescribing neurologists are currently Gralise prescribers
  • Increases the sales support for CAMBIA, moving from the current 35 sales reps with Nautilus to Depomed's existing 155 sales territories, reaching more of the target audience for the drug
  • Secures a long term revenue stream with settled ANDA litigation and generic entry expected in January 2023

"CAMBIA, our third product acquisition in 18 months, is a unique and fast acting treatment for migraine with long-term growth potential that is a great fit in our pain and neurology-focused portfolio," said Jim Schoeneck, President and CEO of Depomed. "Some of the capital secured in October 2013 from the sale of our royalties in type 2 diabetes assets is being put to work in this product acquisition that leverages our current infrastructure. We will continue to actively seek products that complement our pain and neurology portfolio and position us for a strong growth trajectory in the coming years."

Transaction Details
  • Depomed acquired all US rights to CAMBIA in return for $48.7 million cash, $7.5 million of which will be deposited into an escrow account
  • Depomed will pay Nautilus up to $5 million in net sales milestone payments and will assume certain liabilities, including third party royalties and up to $10 million in third party sales milestone payments

Financial and Operational Guidance
  • Depomed expects the acquisition of CAMBIA to be immediately accretive
  • Updated year end 2013 cash guidance of $268 to $272 million, pending future payment of taxes related to the PDL transaction

CAMBIA is a powdered formulation of diclofenac potassium that is dissolved in liquid. It has a rapid onset and has demonstrated in clinical studies relief of the pain and associated symptoms of migraine, including nausea, sensitivity to light and sensitivity to sound. It was launched in 2010.

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