Though Horizon Pharma plc's (HZNP) $800 million purchase of Raptor Pharmaceutical Corp. (RPTP) is pegged by some as an expensive deal for the rare-disease drug company, it's a nice strategic fit and leaves the company with the flexibility to continue its aggressive M&A strategy, CEO and Chairman Tim Walbert told The Deal, a sister publication of TheStreet, on Monday.
That's likely a factor of management's higher-than-expected peak sales estimates of $300 million for Procysbi, Nierengarten suspects.
"They're [Horizon] presumably thinking they can raise its price and find more patients," Nierengarten said. "I think that's a bit of a stretch. I think the population is already known."
While officials with Raptor declined to comment on Monday, Nierengarten said a sale of Raptor made sense after the failure of its trial last fall evaluating its drug for non-alchoholic steatohepatitis (NASH) in children.
For Dublin-based Horizon, the acquisition comes in the wake of the company in November withdrawing its $3.4 billion bid for Depomed Inc. (DEPO) after a judge in the Superior Court of California for the County of Santa Clara in San Jose issued a preliminary injunction suspending Horizon's proposed exchange offer and proxy contest for the Newark, Calif., target.
Just weeks after backing out of the deal, the drugmaker announced an all-cash deal to acquire Crealta Holdings LLC, a marketer of gout treatment Krystexxa, for $510 million.
Horizon, formerly based in Deerfield, Ill., moved to Dublin through a $660 million merger with Irish drug company Vidara Therapeutics International Ltd. completed in September 2014. The company maintains operations in Lake Forest, Ill.
—David Marcus contributed to this report.
EDITORS' NOTE: A version of this article was originally published by The Deal, a sister publication of TheStreet that offers sophisticated insight and analysis on all types of deals, from inception to integration on Monday, Sept. 13. Click here for a free trial.