By Kim Coghill
Inhale Therapeutic Systems Inc. Friday said it intends to complete its $60.6 million acquisition of Quadrant Healthcare Plc within 60 to 90 days.
The all-cash deals values each Quadrant share at 87 cents (60 pence) each.
San Carlos, Calif.-based Inhale Therapeutic Systems in eyeing the London-based company in an effort to expand its own technology, broaden its collaborative relationships and provide a base of operation in foreign markets, according to Robert Chess, Inhale's chairman.
"Inhale is committed to offering the broadest platform and best technology to our partners," Chess told BioWorld Today.
Inhale has developed a drug delivery platform that combines innovations in powder technology and inhalation devices for the delivery of inhalable drugs. Quadrant, which was founded in 1988 and has about 70 employees, develops technology to enhance the delivery of medicines via the inhaled, oral and injectable routes.
Earlier this month Inhale raised about $200 million through the private sale of convertible subordinated notes, Chess said. "We said we were going to raise $150 million, but we did better than that. Part of the purpose for raising the money was acquisitions." (See BioWorld Today, Oct. 11, 2000.)
In February the company raised $230 million and another $108.5 million was raised in October 1999, both through the sale of convertible subordinated debentures with 5 percent and 6.5 percent interest rates, respectively. (See BioWorld Today, Feb. 1, 2000.)
Inhale had $309 million in cash and short-term investments as of June 30, and 42.2 million shares outstanding.
Its stock (NASDAQ:INHL) closed Friday at $46.062, up $1.187.
Inhale and Quadrant had been involved in a patent dispute regarding glass stabilization technology. The case was scheduled to be heard in the UK High Court in 2001.
Chess said Inhale filed the dispute, but would not comment on resolving the matter. However, Quadrant Chief Executive Iain Ross was quoted as saying he expects an amicable resolution to the case.
As part of the acquisition, Inhale stands to inherit Quadrant's collaborations and joint ventures with several major health care companies.
Quadrant and London-based Glaxo Wellcome plc are collaborating on the controlled release of the pulmonary delivery of steroids and beta agonists for the treatment of lung disease.
A year ago Quadrant formed a joint venture with Monmouth Junction, N.J.-based MicroDose Technologies Inc. to develop and exploit the pulmonary delivery of peptides and proteins.
And in another joint venture, Quadrant and Athlone, Ireland-based Elan Corp. plc are working on two projects aimed at developing a novel delivery platform. Elan owns 5 million Quadrant shares, or 7.2 percent of the company.
Nomura Securities Co., which owns 25 percent of Quadrant, already has approved the merger.
Inhale is developing an inhalable insulin formulation with Pfizer Inc., a product in Phase III trials. It also is working with Biogen Inc. on Avonex for multiple sclerosis, Centeon LLC on an alpha-1 proteinase inhibitor for emphysema, and Eli Lilly and Co. on Forteo for osteoporosis. All those products are in Phase I studies.