Philip Morris (NYSE:PM) announced today that it agreed to acquire inhaled drug delivery technology developer Vectura for $1.2 billion.
New York–based Philip Morris agreed with the board of Vectura Group on the all-cash, recommended offer under which Vectura shareholders would be entitled to receive $2.07 per share (150 pence), representing a 46% premium to the ex-dividend closing price per Vectura share of $1.42 (103 pence) on May 25, 2021.
Vectura develops inhaled drug delivery solutions, with 13 key inhaled as well as 11 non-inhaled products marketed by global pharmaceutical partners. Additionally, the company has a diverse portfolio of partnerships for drugs in clinical development, according to a news release.
The company brought in net revenues of $245 million in 2020, with the transaction representing a multiple of about 14 times Vectura’s 2020 EBITDA. Philip Morris will fund the transaction with existing cash and expects it to close in the second half of 2021, subject to a shareholder vote and approval by regulatory authorities. The company anticipates an immaterial impact from the acquisition related to its full-year adjusted diluted EPS.
Philip Morris – a multinational cigarette and tobacco product manufacturer — said that the acquisition allows it to gain access to Vectura’s technologies that can help it reach its goal of generating more than 50% of its total net revenue from smoke-free products by 2025, with aims to generate at least $1 billion in net revenues by that point from its “Beyond Nicotine” products.
The company said it believes that, with Vectura, it can create a fully-owned pipeline of products across a range of sectors in the prescription drug and over-the-counter categories to complement Vectura’s CDMO business. Philip Morris aims for its Beyond Nicotine aerosolization technologies and development pipeline to bring predictability, stability and security for Vectura’s future.
“PMI’s Beyond Nicotine strategy, announced in February, articulates a clear ambition to leverage our expertise in inhalation and aerosolization into adjacent areas—including respiratory drug delivery and selfcare wellness—with a goal to reach at least USD 1 billion in net revenues by 2025,” Philip Morris CEO Jacek Olczak said in the release. “The acquisition of Vectura, following the recently announced agreement to acquire Fertin Pharma, will position us to accelerate this journey by expanding our capabilities in innovative inhaled and oral product formulations in order to deliver long-term growth and returns.”
“The market for inhaled therapeutics is large and growing rapidly, with significant potential for expansion into new application areas. PMI has the commitment to science and the financial resources to empower Vectura’s skilled team to execute on an ambitious long-term vision. Together, PMI and Vectura can lead this global category, bringing benefits to patients, to consumers, to public health, and to society-at-large.”