July 19, 2016
By Mark Terry, BioSpace.com Breaking News Staff
SciClone Pharmaceuticals announced today that after a review, it was no longer actively looking to be acquired.
As part of its February 2016 strategic review, SciClone had been looking for buyers. “Together with our financial advisor Lazard, we are evaluating a wide range of strategic alternatives to maximize stockholder value,” said Jon Saxe, SciClone’s board chairman in a statement. “As part of our evaluation, we approached a significant number of potential acquirers of the Company. The Board determined that at this time remaining an independent publicly traded company was the best path forward to maximize long-term stockholder value. Based on what we have learned in this part of the process, the Board intends to continue to review and refine the Company’s corporate strategy and evaluate new opportunities.”
Although there were apparently several bids, none of them included a premium to its recent share trading price. The company also announced its full-year 2016 financial guidance, with annual revenues to range from $158 to $163 million. Non-GAAP earnings per share on a fully diluted basis are expected to range from $0.70 to $0.74.
On May 10, the company provided its first quarter 2016 financial results, with first quarter revenues of $36.5 million, up from $33.6 million for the same period in 2015. Non-GAAP net income in the first quarter was $9.7 million compared to $9.8 million in the same period in 2015.
“Building on our 2015 momentum, we delivered another strong quarterly performance,” said Friedhelm Blobel, SciClone’s chief executive officer, in a statement at the time. “Our core business, driven by Zadaxin, continued to outpace the growth rate of the China pharma market. Today, Zadaxin has achieved more than 40 percent of the value share in the thymalfasin market category in China, and our volume share has increased to 17 percent, an impressive achievement. We achieved substantial growth in our oncology portfolio this quarter compared to prior quarters, including the products we promote for our pharmaceutical partners, Baxter and Pfizer. While still modest in size, our oncology portfolio is a key strategic asset for our Company. We anticipate continued growth in the coming years as we introduce additional anticancer products into the market.”
Zadaxin (thymalfasin) is marketed in over 30 countries. It is used to treat hepatitis B, hepatitis C, certain cancers, and as an immune system enhancer.
In February, the company announced that it had made an agreement with the U.S. Securities and Exchange Commission (SEC) that fully resolved the agency’s investigation into violations of the Foreign Corrupt Practices Act (FCPA). SciClone agreed to pay $12.8 million, including disgorgement, pre-judgment interest and a penalty. The company stated, “As part of the agreement, the Company neither admits nor denies it engaged in any wrongdoing. The Department of Justice (DOJ) has also completed its related investigation and has declined to pursue any action.”
The investigation, according to an SEC filing revolved around bribery schemes in China. The SEC states, “From at least 2007 to 2012, employees of SciClone subsidiaries, who acted as agents of SciClone in conducting business in China, gave money, gifts and other things of value to foreign officials, including healthcare professionals who were employed by state-owned hospitals in China, in order to obtain sales of SciClone pharmaceutical products. Various means were employed, and these schemes were known to and condoned by various managers within SciClone’s China-based corporate structure. The related transactions were falsely recorded in SciClone’s books and records as legitimate business expenses, such as sponsorships, travel and entertainment, conferences, honoraria, and promotion expenses. During this period, SciClone also failed to devise and maintain a sufficient system of internal accounting controls and lacked an effective anti-corruption compliance program.”
SciClone is currently trading for $11.08.
