Novartis Buying US Biotech Company for $200 Million

Novartis has announced plans to buy US biotech company Spinifex Pharmaceuticals. While the Swiss drugs giant declined to disclose financial terms, Spinifex said it would receive $200 million. The privately held company headquartered at Stamford, Connecticut, with an office in Melbourne, Australia, makes treatments for chronic pain.
The deal set to close in the second half of this year could also include payments based on progress in clinical trials as well as regulatory milestones. While small by Novartis’ standards, it could be an important step toward expanding the company’s high-end pipeline.
Acquiring Spinifex will give Novartis access to Spinifex’s experimental neuropathic pain drug EMA401, which showed positive mid-stage Phase II clinical trial results in treating post-herpetic neuralgia (PHN), without serious side effects.
David Epstein, CEO of Novartis Pharmaceuticals, said Spinifex’s lead product EMA401 “could provide a novel, differentiated treatment approach to provide relief for patients and healthcare providers worldwide.” Novartis also plans to continue the development of EMA401 and intends to start Phase IIb clinical trials in patients with PHN or painful diabetic neuropathy, a condition caused by diabetes.
Established in 2005, Spinifex is owned by several venture capital groups including Novo, Canaan Partners, GBS Venture Partners, Brandon Capital Partners, Uniseed and the University of Queensland, Australia.