Forest Labs swallows Clinical Data pill in $1.2B buyout

Just weeks after Clinical Data ($CLDA) won a surprising approval for a new antidepressant, Forest Laboratories has swept in to buy the biotech for $1.2 billion, paying $30 a share plus a CVR that could top out at $6. That's considerably more than the stock was trading for prior to the approval, but arguably something of a letdown for investors considering the stock's $33.90 close on Friday.

Forest's price reflects its interest in Viibryd, the newly approved antidepressant that is making a claim that it is safer and triggers fewer sexual side effects than other SSRI drugs now on the market. The drug is being touted as the "first and only" antidepressant to combine an SSRI and a serotonin 1a receptor partial agonist in one molecule. And Newton, MA-based Clinical Data's shares skyrocketed 70 percent on the news as analysts buzzed about a potential buyout and blockbuster status for the newly approved therapy. The developer also has seven other programs now in clinical development.

But not all the experts in the field have been convinced by Clinical Data's studies. Matthew Herper at Forbes recently interviewed several top psychiatrists and found significant skepticism about the claims being made for the drug. "The drug clearly is an active compound," Jeffrey Lieberman, chairman of psychiatry at Columbia University's College of Physicians and Surgeons, told Herper. "But to make statements that you can have any degree of confidence in that it has clearly better safety or efficacy based on this data is really stretching it."

Forest Laboratories, however, was bullish about the new acquisition.

"We believe that we are uniquely positioned to bring Viibryd to market in light of our long and successful experience of clinical development and expertise in the antidepressant market," says CEO Howard Solomon. "This transaction is consistent with our strategy to acquire new products that will help offset the loss of revenues due to patent expiries. Viibryd will be the second new product that we expect to launch this year in addition to Teflaro. In addition, we [hope] to obtain FDA approval later this quarter for Daxas (roflumilast), for the treatment of COPD. We plan to submit New Drug Applications for aclidinium and linaclotide in the second half of this year and for two additional products in calendar 2012."

- here's the Forest press release