BioWorld International Correspondent

LONDON - Archimedes Pharma Ltd. found the acquisition it has been searching for since its formation in 2004, agreeing to buy privately held Link Pharmaceuticals Ltd. for an undisclosed price in an all-cash deal.

The deal was financed by Warburg Pincus, which backed the formation of Archimedes Pharma, set up by three former executives of Shire Pharmaceuticals Group plc with a strategy to grow through the acquisition of companies or products close to registration in Europe, while at the same time developing its own pipeline of products based on proprietary nasal delivery technology.

The acquisition of the British firm Link gives Archimedes a commercial infrastructure of about 40 people with operations in the UK, France and Germany, and a portfolio of niche products including Gliadel, a locally administered chemotherapy for treating high-grade glioma, and Nozinan, and anti-emetic for advanced cancer patients.

Archimedes has taken over all the existing license agreements, and will use the infrastructure to market its own products, the most advanced of which, a nasally administered formulation of fentanyl for use in breakthrough pain in cancer, is expected to reach the market in 2009.

The nasal delivery technology was acquired when Archimedes bought West Pharmaceutical Services Inc. in February 2005, for $7.5 million. At the same time, Warburg Pincus put in a further $40 million for product development.

Richard de Souza, CEO of Reading, UK-based Archimedes, told BioWorld International, "We can now build the footprint. We have made substantial progress with our development pipeline and now have three projects entering Phase III. Of these, we will bring one to market ourselves, with an expected launch of 2009."

The business model is based on previous experience of setting up specialty pharma companies around acquired products. "Once you have launched a product," de Souza said, "everyone asks, What next? In order to be sustainable you need three parts - a very competent sales and marketing operation, products that are approaching registration, and a development pipeline feeding in."

De Souza and his co-founders, Charles Marchetti, chief financial officer, and Michael Clark, marketing director, intended to acquire a European company first as the basis of Archimedes, but were offered the opportunity to buy the nasal portfolio from West Pharmaceutical of Lionsville, Pa., after the U.S. company decided to divest the drug delivery unit in December 2004.

The result was going in as a cash-burning as opposed to cash-generating company, but de Souza said there is "categorically enough money" to get in-house products through to market. Link is a profitable business with expected revenues of about £16 million (US$30.4 million) in 2006.

"The aim is to build a commercial presence in each of the five main European markets, putting the company name in front of physicians," de Souza said.