Analyst: First Quarter of 2015 Crucial to ProSensa Holding N.V., BioMarin Pharmaceutical Inc. Deal

Published: Nov 25, 2014

Analyst: First Quarter of 2015 Crucial to Prosensa, BioMarin Deal

November 25, 2014

By Riley McDermid, Breaking News Sr. Editor

BioMarin Pharmaceutical Inc. ’s acquisition Monday of ProSensa Holding N.V. for $680 million, plus up to $160 million in contingent milestones payments, is a solid deal for investors as long as ProSensa’s drug candidates complete crucial trials, said Jeremiah Shepherd, a biotech analyst for Credit Suisse, today.

“Contingent Value Rights agreements appear achievable to us: We arrive at a premium to the offer price by probability adjusting the NPV of the anticipated CVRs by 80 percent,” wrote Shepherd in a note to investors. “We believe that both CVRs are achievable as RNA should have additional data to supplement the expected NDA and MAA filings ahead of the potential approvals.”

Under the terms of the deal, BioMarin will buy all of Prosensa’s issued and outstanding shares and all ordinary share equivalents with cash for $17.75 per share. There are then two built-in regulatory milestones that will have to be met before the Prosensa can cash in: The first for U.S. approval of drisapersen in the U.S. no later than May 15, 2016, and the second for approval in Europe no later than Feb. 15, 2017.

Those milestones theoretically appear achievable, said Shepherd in his note. “Rolling NDA still on track for completion in first quarter of 2015. The final module is still expected to be submitted in the first quarter of 2015 and is likely to be evaluated under a priority review,” he said. “The CVR for U.S. accelerated approval has a deadline of May 15, 2016 which should provide sufficient breathing room to address any issues the FDA may have with the NDA filing.”

Both companies look to be on track for approval from global regulators, said Shepherd, as BioMarin’s massive size is likely to help ProSensa navigate what can sometimes be tricky international regulatory standards.

“EU filing now sometime in 2015,” he said. “The MAA is now expected to be filed in 2015, which provides a broader window than previous guidance of the first quarter of 2015. The CVR for EU accelerated approval has a deadline of Feb. 15, 2017.”

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