Valeant Pharmaceuticals reaches deal to buy Dendreon’s prostate cancer drug Provenge and other assets

Valeant Pharmaceuticals International Inc said late yesterday that it had reached a tentative deal to buy the prostate-cancer drug Provenge as also other assets from Dendreon Corp for $296 million in cash, Dow Jones Business News reported.

According to the Quebec-based company, it had entered into a so-called stalking-horse agreement, which meant it was the preferred bidder and the company would receive an unspecified breakup fee and reimbursed expenses if its bid did not win the auction for Dendreon's assets. Valeant added, the bid and sale would need to be approved by a bankruptcy court.

The deal would mark Valeant's first big move after it failed in its hostile takeover attempt of Botox maker Allergan Inc. Actavis PLC ended up buying Allergan in November for $66 billion.

After  losing out on Allergan, Valeant indicated it would focus on expansion of its business. However Dendreon appeared to have been too tempting a target according to commentators.

Dendreon filed for Chapter 11 bankruptcy in November after failing to fulfill its hopes of reaping big profits from the pricey Provenge. Provenge failed to get a supportive response from doctors. The drug cost $93,000 for a course of treatment but improved median survival for prostate-cancer patients by just over four months.

Provenge had notched up $300 million in 2014 revenue, Valeant said.

Meanwhile, Reuters reported that drug's approval by US regulators in 2010, had lifted hopes that Provenge would become a blockbuster, but adoption of the drug, an injection to reprogramme the immune system to attack advanced prostate cancer cells, was hindered by its hefty price tag and uncertainty over insurance coverage.

"We are confident that this process will result in a strong new owner for Provenge, and that patients will continue to receive treatments with no disruption moving forward," Dendreon chief executive Thomas Amick said in a statement.

Valeant said last month that it was targeting acquisitions in Asia, the Middle East, Africa and Latin America and that it also wanted to build up its US dental business and its dermatology, surgical and ophthalmology lines.

"We believe that oncology has similar characteristics to our current therapeutic portfolios ... We have not previously found an economic way to enter this market," Valeant CEO Michael Pearson said in a statement.