UK’s Shire to buy Belgium's GI drug specialist Movetis for €428 million

British specialty biopharmaceutical firm, Shire Plc said yesterday that it has agreed to buy Belgium's Movetis NV for €428 million ($559 million) in cash to boost its gastrointestinal (GI) products portfolio and expand its market in Europe.

The proposed acquisition will expand Shire's gastrointestinal market in Europe with Movetis' recently launched Resolor, which is used in the treatment of chronic constipation in women and approved in the 27 countries European Union and a few other countries.

Resolor, which enjoys patent protection through 2020, Shire estimates potential annual peak sales of over €300 million for the drug that is sold in the EU, Iceland, Lichtenstein, Norway and Switzerland and Movetis is entitled to royalties on sales of outside of Europe from Johnson & Johnson.

Under the deal, Shire will offer €19 per share in cash, valuing Movetis at €428 million. Since Movetis held €100 million in cash, the enterprise value of the transaction, less cash of Movetis would be €328 million.

The offer price represents a premium of 74 per cent to Movetis's closing share price on 2 August 2010 at €10.90.

Shire said that it will fund the acquisition from its current cash resources.