9. Lantheus buys Progenics after Velan Capital’s approval

Gloved merger acquisitions
The activist backer Velan Capital—which held shares in both companies—was locked in a proxy battle for Progenics when it inked the deal to be acquired by Lantheus, a move that Velan described at the time as “a misguided attempt to seek out the nearest exit.” (Getty Images)

Deal value: $641 million
Announced: October 2, 2019
Closed: June 22, 2020

Lantheus, a maker of diagnostic imaging hardware and nuclear medicine agents, hoped to acquire the cancer drugmaker Progenics Pharmaceuticals in order to merge its manufacturing background with the latter’s clinical R&D pipeline and FDA-approved products—but the company’s investors didn’t go down without a fight.

The activist backer Velan Capital—which held shares in both companies—was locked in a proxy battle for Progenics when it inked the deal to be acquired by Lantheus, a move that Velan described at the time as “a misguided attempt to seek out the nearest exit.”

The month before, Velan had called for a replacement of the company’s CEO, Mark Baker, plus the addition of five hand-picked nominees to its board of directors—following accusations that Progenics had diluted its stock for personal executive gains. 

Velan would ultimately prevail, gaining enough shareholder votes to oust Baker and two other board members—David Scheinberg and Nicole Williams—and launch a reassessment of Progenics’ business and objectives. 

RELATED: After a bitter fight, activist boots Progenics directors—and eyes a CEO swap next

The deal with Lantheus started with an offer to trade 0.2502 shares of Lantheus stock for each of Progenics’ outstanding shares—amounting to a 21% premium over its current stock price, and an approximate 35% ownership stake in the combined venture going forward.

Together, Progenics and Lantheus were projected to bring in combined pro forma revenue topping $370 million, including Lantheus’ microbubble franchise of cardiovascular ultrasound contrast agents, radiopharmaceuticals for diagnosing cancer, and an FDA-cleared artificial intelligence platform in oncology.

However, that deal was later renegotiated by the new board and amended the following February, with Velan signing off on a boost of up to 0.31 Lantheus shares for each Progenics share and 40% ownership, plus a non-tradeable contingent value right linked to the future commercial success of Progenics’ PyL imaging agent for prostate cancer, should it cross sales thresholds of $100 million in 2022 and $150 million in 2023.

All told, the $641 million deal was subsequently approved in shareholder votes that June. PyL, meanwhile, has since been submitted to the FDA, which granted it priority review to help visualize primary tumors as well as bone and soft tissue metastases, with a regulatory decision expected by the end of May.

9. Lantheus buys Progenics after Velan Capital’s approval