-On an Adjusted EBITDA Basis, Transaction Expected to be EBITDA Accretive and to Move Profitability Forward to 2017-
-Company to Host Conference Call on October 4, 2016 at 8:30 a.m.
ET-
MISSISSAUGA, Ontario, Oct. 4, 2016 /CNW/ -- Aralez Pharmaceuticals Inc. (NASDAQ: ARLZ) (TSX: ARZ), a
global specialty pharmaceutical company, today announced it will acquire the U.S. rights to Toprol-XL® (metoprolol succinate) and
its Authorized Generic (AG) pursuant to an agreement entered into between AstraZeneca and Aralez Pharmaceuticals Trading DAC, a
subsidiary of Aralez. Toprol-XL is a cardioselective beta-blocker indicated for the treatment of hypertension, alone or in
combination with other antihypertensives; the long term treatment of angina pectoris and treatment of stable, symptomatic (NYHA
class II or III) heart failure of specific origins. It was first approved in the U.S. in 1992. AstraZeneca recorded U.S. net
revenues from Toprol-XL and its AG of $89 million and $53 million in
2015 and year-to-date June 2016, respectively. The transaction is expected to be immediately EBITDA
accretive and to move profitability forward to 2017, in each case on an adjusted EBITDA basis. The transaction is expected to be
completed in the fourth quarter of 2016, subject to customary closing conditions.
The agreement includes an initial upfront payment of $175 million, which will be financed through
a previously committed senior secured debt facility with Deerfield Management. At closing, Aralez will also borrow funds under this
credit facility to replenish $25 million that was paid from cash on hand in connection with the
recently announced ZONTIVITY® acquisition. In addition, Deerfield has
agreed to provide Aralez access to up to an additional $250 million in capital to fund future
mutually agreeable acquisitions. The transaction with AstraZeneca also includes mid-teen percentage royalties and up to
$48 million of potential contingent milestone payments. In connection with the Asset Purchase
Agreement, at closing the parties will enter into a Supply Agreement pursuant to which AstraZeneca will continue to manufacture and
supply Toprol-XL and the AG to Aralez for at least ten years, a License Agreement with respect to certain trademarks and copyrights
and a Transition Services Agreement. Under the terms of the Transition Services Agreement, AstraZeneca will continue to distribute
the product on behalf of Aralez for up to nine months until the product is transferred to Aralez Pharmaceuticals Trading DAC.
"We are delighted to enter into an agreement with AstraZeneca for the U.S. rights to Toprol-XL and its AG, a beta blocker that
further broadens our cardiovascular portfolio and, importantly, strengthens our financial profile by generating meaningful cash,
which should accelerate our profitability to 2017 on an adjusted basis in addition to offsetting launch costs for
YOSPRALA™ and ZONTIVITY," said Adrian Adams, Chief Executive Officer of
Aralez. "This transaction further reflects our ability to deliver against the expectations that we set upon the formation of Aralez
that included promoting FIBRICOR®, approval and commercialization of YOSPRALA, and seizing opportunities to
expand through aggressive business development and licensing as evidenced by our recent acquisition of ZONTIVITY and now
Toprol-XL."
Toprol-XL is an extended-release tablet that belongs to a family of high blood pressure medications known as beta-blockers.
Extended-release tablets need to be taken only once a day. After swallowing Toprol-XL, the coating of the tablet dissolves,
releasing a multitude of controlled release pellets filled with metoprolol succinate. Each pellet acts as a separate drug delivery
unit and is designed to deliver metoprolol continuously over the dosage interval of 24 hours.
Greenhill & Co. served as Financing Advisor and Willkie Farr & Gallagher LLP served as
Legal Advisor in connection with the transaction.
Conference Call and Webcast
Aralez will host a conference call today at 8:30 a.m. ET, to discuss details of the
transaction. The webcast can be accessed live and will be available for replay at www.aralez.com.
Conference Call Details
Date: Tuesday, October 4, 2016
Time: 8:30 a.m. ET
Dial-in (U.S.): 877-407-8037
Dial-in (International): 201-689-8037
About Hypertension
Hypertension, or high blood pressure, is dangerous because it makes the heart work too hard and contributes to
atherosclerosis (hardening of the arteries). It increases the risk of heart disease and stroke, which are the first and third
leading causes of death among Americans. High blood pressure can also result in other conditions, such as congestive heart failure,
kidney disease, and blindness.
About Toprol-XL
Toprol-XL® is approved for the treatment of high blood pressure. By lowering blood pressure, Toprol-XL may
lower the risk of fatal and non-fatal cardiovascular events, primarily strokes and myocardial infarctions. Toprol-XL is also
indicated for the long-term treatment of angina pectoris, to reduce angina attacks and to improve exercise tolerance and for the
treatment of stable, symptomatic (NYHA Class II or III) heart failure of ischemic, hypertensive, or cardiomyopathic origin. It was
studied in patients already receiving ACE inhibitors, diuretics, and, in the majority of cases, digitalis. In this population,
Toprol-XL decreased the rate of mortality plus hospitalization, largely through a reduction in cardiovascular mortality and
hospitalizations for heart failure.
Control of high blood pressure should be part of comprehensive cardiovascular risk management, including, as appropriate, lipid
control, diabetes management, antithrombotic therapy, smoking cessation, exercise, and limited sodium intake. Many patients will
require more than 1 drug to achieve blood pressure goals.
Toprol-XL is supplied as 25mg, 50mg, 100mg and 200mg tablets designed for oral administration. For full prescribing
information and additional important safety information, please visit: www.TOPOL-XL.com.
Important Safety Information
Because of the possibility of serious side effects, such as chest pain or a heart attack, you should not stop taking Toprol-XL
suddenly. If your doctor decides you should stop taking Toprol-XL, you may be instructed to slowly reduce your dose over a period
of time before stopping it completely.
Toprol-XL may not be right for everyone, especially people who have the following health conditions:
- Extreme slowing of the heart rate.
- Sudden and severe drop in blood pressure and blood flow through the body because the heart is not pumping normally.
- Uncontrolled heart failure.
- Slowdown of the heart's electrical signal causing a slower heart rate.
- Damage to the heart's natural pacemaker that affects the heart's rhythm unless one has a pacemaker device.
- Any allergies to Toprol-XL or its ingredients.
It is important to take your medications every day as directed by your doctor.
Patients who have asthma or asthma-like lung disease should, in general, not take Toprol-XL.
Your doctor may not want you to take Toprol-XL if you are currently taking certain types of high blood pressure medicine, or
have adrenal gland tumors, diabetes, low blood sugar, liver damage, overactive thyroid disease, or hardening of the arteries in the
arms or legs.
Your doctor may not want you to start taking Toprol-XL if you are about to have any type of surgery.
If you have a history of serious allergic reactions, the usual dose of epinephrine (adrenaline) may not work as well if you are
taking Toprol-XL.
Until you know how you will react to Toprol-XL, avoid activities that require alertness.
Contact your doctor if you have any difficulty in breathing.
In patients with high blood pressure, the most common side effects were tiredness, dizziness, depression, diarrhea, itching or
rash, shortness of breath, and slow heart rate. If you experience any of these or other side effects, contact your doctor.
About Aralez Pharmaceuticals Inc.
Aralez Pharmaceuticals Inc. (NASDAQ: ARLZ and TSX: ARZ) is a global specialty pharmaceutical company focused on
delivering meaningful products to improve patients' lives while creating shareholder value by acquiring, developing and
commercializing products primarily in cardiovascular, pain and other specialty areas. Aralez's Global Headquarters is in
Mississauga, Ontario, Canada, its U.S. Headquarters is planned to be in Princeton, NJ and the Irish Headquarters is in Dublin, Ireland. More
information about Aralez can be found at www.aralez.com.
Cautionary Language Concerning Forward-Looking Statements
This press release includes certain statements that constitute "forward-looking statements" within the meaning of
applicable securities laws. Forward-looking statements include, but are not limited to, statements regarding transition matters and
our ability to successfully integrate the acquisition of the U.S. rights to Toprol-XL and its AG, the closing of the acquisition of
the U.S. rights to Toprol-XL and its AG, including the expected completion in the fourth quarter of 2016, financing the upfront
payment of the acquisition of the U.S. rights to Toprol-XL and its AG under the debt facility with Deerfield Management and
borrowing under such facility to replenish cash paid in connection with the recently announced ZONTIVITY acquisition, access to up
to an additional $250 million in capital from Deerfield Management to fund future mutually agreeable
acquisitions, payments of royalties and potential contingent milestones with respect to Toprol-XL and its AG, the distribution of
the product by AstraZeneca on behalf of Aralez for up to nine months, the manufacture and supply of Toprol-XL and the AG by
AstraZeneca, the benefits of Toprol-XL and its AG, the expected benefits to us of the acquisition of the U.S. rights to Toprol-XL
and its AG, including that the transaction is expected to be immediately EBITDA accretive and to move profitability forward to
2017, in each case on an adjusted EBITDA basis, Toprol-XL and its AG as further broadening our cardiovascular portfolio and the
acquisition as strengthening our financial profile by generating meaningful cash, offsetting launch costs for YOSPRALA and
ZONTIVITY, the acquisition of the U.S. rights to Toprol-XL and its AG reflecting our ability to deliver against the expectations
that we set upon our formation, that included promoting FIBRICOR, approval and commercialization of YOSPRALA, and seizing
opportunities to expand through aggressive business development and licensing, and other statements that are not historical facts,
and such statements are typically identified by use of terms such as "may," "will," "would," "should," "could," "expect," "plan,"
"intend," "anticipate," "believe," "estimate," "predict," "likely," "potential," "continue" or the negative or similar words,
variations of these words or other comparable words or phrases, although some forward-looking statements are expressed
differently.
You should be aware that the forward-looking statements included herein represent management's current judgment and
expectations, and are based on current estimates and assumptions made by management in light of its experience and perception of
historical trends, current conditions and expected future developments, as well as other factors that it believes are appropriate
and reasonable under the circumstances, but there can be no assurance that such estimates and assumptions will prove to be correct
and, as a result, the forward-looking statements based on those assumptions could prove to be incorrect. Accordingly, actual
results, level of activity, performance or achievements or future events or developments could differ materially from those
expressed or implied in the forward-looking statements. Our operations involve risks and uncertainties, many of which are outside
of our control, and any one or any combination of these risks and uncertainties could also affect whether the forward-looking
statements ultimately prove to be correct and could cause our actual results, level of activity, performance or achievements or
future events or developments to differ materially from those expressed or implied by the forward-looking statements. These risks
and uncertainties include, without limitation, our inability to build, acquire or contract with a sales force of sufficient scale
for the commercialization of YOSPRALA, ZONTIVITY and FIBRICOR in a timely and cost-effective manner; our failure to successfully
commercialize our products and product candidates; increased generic competition; costs and delays in the development and/or
approval of our product candidates, including as a result of the need to conduct additional studies or due to issues with
third-party API or finished product manufacturers, or the failure to obtain such approval of our product candidates for all
expected indications, including as a result of changes in regulatory standards or the regulatory environment during the development
period of any of our product candidates; the inability to maintain or enter into, and the risks resulting from our dependence upon,
collaboration or contractual arrangements necessary for the development, manufacture, commercialization, marketing, sales and
distribution of any products, including our dependence on AstraZeneca AB and Horizon Pharma USA,
Inc. for the sales and marketing of VIMOVO, our dependence on Patheon Pharmaceuticals Inc. for the manufacture of YOSPRALA, our
dependence on Schering-Plough (Ireland) Company for the supply of ZONTIVITY and (following the
closing of the acquisition of the U.S. rights thereto) our dependence on AstraZeneca AB for the manufacture and supply of Toprol-XL
and its AG; our ability to protect our intellectual property and defend our patents; regulatory obligations and oversight; failure
to successfully identify, execute, integrate and maintain new acquisitions, such as the integration of ZONTIVITY and (following the
closing of the acquisition of the U.S. rights thereto) Toprol-XL and its AG; fluctuations in the value of certain foreign
currencies, including the Canadian dollar, in relation to the U.S. dollar, and other world currencies; changes in government
regulations, including tax laws and unanticipated tax liabilities; general adverse economic, market and business conditions; and
those risks detailed from time-to-time under the caption "Risk Factors" and elsewhere in the Company's Securities and Exchange
Commission ("SEC") filings and reports and Canadian securities law filings, including in our Annual Report on Form 10-K for the
year ended December 31, 2015 and our Quarterly Report on Form 10-Q for the quarterly period ended
June 30, 2016, which are available on EDGAR at www.sec.gov, on SEDAR at www.sedar.com, and on the Company's
website at www.aralez.com, and those described from time to time in our future
reports filed with the SEC and applicable securities regulatory authorities in Canada. You should
not place undue importance on forward-looking statements and should not rely upon this information as of any other date. We
undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future
events or otherwise, unless required by law.
Contact Information:
Aralez Pharmaceuticals US Inc.
Nichol Ochsner
Executive Director,
Investor Relations & Corporate Communications
732.754.2545
nochsner@aralez.com
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SOURCE Aralez Pharmaceuticals Inc.
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