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"The acquisition of Cytogen is of great strategic importance for EUSA asit completes the building of our transatlantic commercializationinfrastructure, as well as fitting perfectly with our focus on oncology andpain control," said Bryan Morton, Chief Executive of EUSA Pharma. "Over thelast 18 months EUSA has built a strong European organization covering over 20countries and marketing a portfolio of six specialty pharmaceuticals.Cytogen's products and US infrastructure are the ideal complement to ourbusiness, offering us the opportunity to commercialize a rapidly growingportfolio of medicines on both sides of the Atlantic."
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Commenting on the acquisition, Rolf Stahel, Chairman of EUSA Pharma,said, "The acquisition of Cytogen marks a step change in the growth of EUSAand completes the foundations of a world-class specialty pharmaceuticalcompany. This transaction will transform our business, putting in place atruly transatlantic growth platform, and positioning the company as thepartner of choice for future acquisitions and specialty product in-licensing."
Strategic rationale
The acquisition of Cytogen brings to the enlarged EUSA group anestablished US commercial organization with a 40-strong specialist oncologysales force and three marketed products.
- Caphosol(R) is a supersaturated calcium phosphate rinse indicated forthe treatment of oral mucositis, a common and debilitating side-effect ofradiation therapy and high-dose chemotherapy, and for the treatment ofxerostomia.
- ProstaScint(R) is a monoclonal antibody-based agent used to image theextent and spread of prostate cancer.
- Quadramet(R) is a radiopharmaceutical for the treatment of pain inpatients whose cancer has spread to the bones.
The enlarged group will have broad sales and marketing capabilities, viadirect sales forces in the US and across Europe, and through distributionpartners in a number of territories including Canada, South America and Asia.EUSA will have a portfolio of nine marketed medicines and five late-stagedevelopment products. The acquisition of Cytogen provides EUSA with thecapabilities to commercialize a number of these medicines on both sides ofthe Atlantic.
In addition, the enlarged group's transatlantic infrastructure providesthe company with a strategic growth platform to exploit additional productsthrough acquisition and in-licensing. With its highly focused business model,EUSA will have the opportunity to compete effectively with major players,making it an attractive partner for companies seeking specialisttransatlantic commercial and late-stage development expertise.
Transaction details
Under the terms of the all-cash merger agreement Cytogen shareholderswill receive US$0.62 per share, representing a 35% premium on the company'sshare price at the close of trading on 10 March 2008, and valuing the companyat US$22.6 million.
The Cytogen Board has approved the cash merger agreement and resolved torecommend that the company's shareholders adopt the agreement. Completion ofthe acquisition is conditional on the approval of a majority of Cytogen'sshareholders and fulfillm
