JAPAN — Astellas, a Japanese pharmaceutical company, has announced its intention to acquire Iveric Bio for US$40 per share in cash, totaling approximately US$5.9 billion in equity value.
The acquisition aims to enhance Astellas’s focus on therapies for blindness and regeneration by acquiring Iveric, which has developed a drug called Zimura that is a potential treatment for geographic atrophy (GA).
GA is a condition that affects patients with age-related macular degeneration and leads to the destruction of retinal cells, ultimately resulting in the loss of central vision and blindness.
Iveric estimates that around 1.6 million people in the U.S. have GA, a condition associated with the excessive activity of the complement system, a part of the immune system.
Zimura, Iveric’s drug, is designed to block a complement system protein called C5 and is injected into the eye once a month.
The GA market is substantial enough to accommodate multiple treatment options.
For instance, the market for GA treatments is projected to grow at a compound annual growth rate of 7.5% during the forecast period, reaching a valuation of US$35.80 billion by 2030, according to a report by Market Research Future.
The growth in the GA market is attributable to the increasing prevalence of age-related macular degeneration (AMD) in the geriatric population, which is expected to increase from 727 million individuals above 65 years in 2020 to 1.5 billion by 2050, as per a UN report.
As per the World Bank, the geriatric population made up 9.3% of the population in 2020, a significant increase from 5.9% in 1985.
In this scenario, Iveric’s upcoming FDA decision date makes it a strong contender to become the second approved treatment for GA.
Given that approximately 1.6 million people in the U.S. suffer from GA, there is enough room in the market for multiple treatment options.
Additionally, Iveric’s pipeline includes gene therapies for vision-loss disorders, which aligns with Astellas’s gene therapy strategy, thereby making the acquisition of Iveric a vital component of Astellas’s growth strategy.
Astellas views Zimura as a significant contributor to its goal of reaching ¥1.7 trillion (about US$12.3 billion) in sales by fiscal year 2025.
Currently, Astellas’s biggest revenue source is the prostate cancer drug Xtandi, which generated ¥534.3 billion (about US$3.9 billion) in sales in the 2021 fiscal year, with more than half of its sales coming from the U.S., where Pfizer markets the drug under a collaboration agreement.
The agreement mandates that the partners share profits from U.S. sales of the drug equally, with Xtandi’s patents expiring in 2027.
The acquisition of Iveric provides a foundation of ophthalmology capabilities for Astellas to drive its combined eye business forward.
The Iveric gene therapies are in preclinical development and are potential treatments for Leber congenital amaurosis type 10, Stargardt disease, and Usher syndrome type 2a.
The nearly US$6 billion deal is subject to approval by Iveric’s shareholders as well as other customary closing conditions and regulatory approvals. The acquisition is expected to close in Q3 2023.
For all the latest healthcare industry news from Africa and the World, subscribe to our NEWSLETTER, and YouTube Channel, follow us on Twitter and LinkedIn, and like us on Facebook.
