Almirall buys ready-made dermatology R&D operation in €365M deal

Almirall (BME:ALM) has splashed out €365 million ($386 million) on Poli Group. The takeover gives Almirall the dermatology R&D pipeline and infrastructure it has craved since it flogged its respiratory business to AstraZeneca ($AZN) for $2.1 billion last year.

Almirall headquarters in Barcelona, Spain

Poli Group is comprised of three businesses, but the meat of the deal from an R&D perspective is to be found in Polichem, a Swiss firm with a clutch of dermatology assets in late-phase clinical trials. In exchange for €365 million in cash and up to €35 million in milestones, Almirall will gain control of experimental therapies for psoriasis, fungal nail infections and male-pattern baldness, plus the R&D operation that has ushered the programs into and through the clinic. Polichem also has a portfolio of dermatology, respiratory, gynecology and neurology drugs already on the market.

Barcelona, Spain-based Almirall will combine these assets with what was left of its business after the sale of its respiratory business to AstraZeneca. The near-term focus of what is left of the pipeline following the deal with AstraZeneca is psoriasis treatment LAS41008, a gastric-resistant formulation of dimethyl fumarate that is scheduled to deliver Phase III data in the first half of 2016. Once the Poli Group deal closes, Almirall will add more mid-term data readouts to the calendar. Polichem recently started Phase III trials of two nail treatments, data from which are due between now and 2018.

The deal also gives Almirall a source of new drug candidates. Following its deal with AstraZeneca, Almirall axed 59 R&D staffers who were involved with respiratory drugs because it no longer had any interest in discovering or developing such products. The cuts significantly diminished Almirall's R&D capabilities. Buying Polichem is intended to revitalize R&D Almirall, specifically in dermatology, the field to which the Catalan company has hitched its future. Polichem runs a dermatology-focused R&D operation that has a formulation technology based on a film-forming polymer.

In the near term, Almirall is looking to the assets acquired from Poli Group to gives its dermatology business momentum at a time when it faces pressure from generics and payers, the latter of which are paying close attention to specialty pharma companies in the wake of the Valeant ($VRX) scandal. Almirall is known to use specialty pharmacies for some of its sales in the U.S., a country in which it expects to grow following the acquisition of Poli Group.

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