Lundbeck to pay up to $900M cash for Ovation

Denmark's Lundbeck has struck a deal to buy Ovation Pharmaceuticals for $900 million in cash, providing the European company with a commercial stage in the U.S., a late-stage pipeline of new drugs as well as a new resource of scientific and regulatory talent. Of that money, $600 million goes to Ovation now with another $300 million if one of its top drug prospects wins approval.

"We are very encouraged by what Ovation has achieved in the short time since the company was founded and we look forward to working together in the common interest of both companies," said Lundbeck CEO Ulf Wiinberg. Analysts say that Lundbeck is looking to grow the company ahead of the 2012 loss of patent protection for the depression drug Lexapro. They add that Ovation's primary asset is the experimental seizure drug Sabril, which has been recommended by an FDA committee. Ovation will also market Atryn, a new drug that is being produced in genetically altered animals.

Aside from its development work, Ovation has also been engaged in a fierce struggle with the FTC, which claims that the drug company bought out a rival that made a competing drug in order to charge "monopoly prices." Ovation is disputing the charge.

- read the press release
- here's the report from the Wall Street Journal

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