NEW YORK (The Deal) -- U.K. biotech Circassia Pharmaceuticals on Friday announced its first acquisitions since its March 2014 initial public offering with deals totaling up to $371 million for companies in Sweden and England.
Circassia, of Oxford, agreed to pay up to 1.78 billion Swedish kroner ($214 million) for Stockholm-listed Aerocrine AB, which sells and develops products to diagnose and manage asthma. In the U.K. it has arranged to buy venture capital-backed Prosonix Ltd., also of Oxford, which is working on treatments for asthma and chronic obstructive pulmonary disease, for up to £100 million ($157 million).
Circassia plans to raise £275 million through a share placing to fund the acquisitions. CEO Steve Harris said Aerocrine's "commercial infrastructure" will help with the launch of Circassia's Cat-SPIRE allergy immunotherapy, which is in phase III trials, while the products Prosonix is developing will boost its pipeline.
Aerocrine, a Karolinska Institute spinout, launched its first product in 2001: Niox, which measures airway inflammation. In 2014 it had revenue of Skr166.2 million and made an operating loss of Skr228.2 million. Prosonix generated an operating loss of £400,000 in the year ended March 2014. It hopes to get first approval from the U.K.'s Medicines and Healthcare Products Regulatory Agency,or MHRA, for its first drug, which is a rival to GlaxoSmithKline's Flixotide asthma treatment, in the second half.
"These proposed acquisitions and associated fundraising significantly accelerate Circassia's strategy to become a self-sustaining specialty biopharmaceutical company focused on allergy and asthma," said Harris in a statement. "The combined organisation will give us both the capability and resources to commercialise our enlarged late-stage pipeline of potential new allergy and asthma products, once approved, and thereby generate significant shareholder value."