Allergan buying MAP Pharmaceuticals for $882.5M

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Associated Press

Posted on January 23, 2013 at 10:00 AM

Updated Wednesday, Jan 23 at 11:01 AM

IRVINE, Calif. (AP) — Specialty drugmaker Allergan is buying migraine headache drug developer MAP Pharmaceuticals Inc. for about $882.5 million as it looks to expand its migraine treatments.

MAP's Levadex is an oral drug for the potential treatment of migraine headaches in adults. It is currently under review with the Food and Drug Administration.

Allergan has received regulatory approval in 56 countries for its Botox injection to be used as a migraine treatment. The company said it hopes to use Levadex as a complementary treatment for migraines.

On Friday Allergan received FDA approval for Botox to be used in treating patients with overactive bladders. Botox is already approved for a half-dozen uses, most famously for removing wrinkles on the forehead, but also muscle spasms, migraine and eyelid twitching.

In 2011 Allergan entered a deal with MAP to co-promote Levadex to neurologists and pain specialists. The agreement was contingent upon potential regulatory approvals in the U.S. and Canada.

Allergan said it will pay $25 per MAP share, which is a 61 percent premium to the company's Tuesday closing price of $15.58. MAP, which is based in Mountain View, Calif., currently has about 35.3 million outstanding shares, according to FactSet. Allergen put the total value of the deal at approximately $958 million.

MAP shares jumped $9.18, or 58.9 percent, to $24.76 in premarket trading Wednesday. Allergan shares were steady at $83.29 shortly before the opening bell.

Both companies' boards unanimously approved the deal, which is expected to close late in the first quarter or in the second quarter.

Allergan expects to fund the acquisition with available cash, cash equivalents and short-term borrowings under its commercial paper program. The transaction is not subject to any financing contingency.

Allergan Inc. anticipates the buyout hurting its 2013 earnings by about 7 cents per share and adding to its earnings per share by 2014's second half. The Irvine, Calif. company said it will give its 2013 outlook on Feb. 5.

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