Mylan challenges Big Pharma's clot fighters with $300M Arixtra buy

Mylan ($MYL) has been on a buying streak. The Pittsburgh-based generics maker has been snapping up companies and eyeing big drug portfolios, laying out billions over the last 12 months for M&A. Now, it has inked a deal for a single drug: Arixtra, an injectable blood thinner that fights clots in the legs and lungs.

The company will pay Aspen Global $300 million for the Arixtra brand and its authorized generic in the U.S., with $225 million up front and another $75 million in milestone payments. The brand brought in $18.8 million last year in the U.S., while the authorized generic snared $95.3 million, Mylan said.

The deep vein thrombosis/pulmonary embolism (DVT/PE) market is crowded and getting more so. Warfarin is a standard drug to treat and prevent blood clots, and a trio of oral alternatives have hit the market in the last few years, namely Boehringer Ingelheim's Pradaxa, Johnson & Johnson ($JNJ) and Bayer's Xarelto, and Bristol-Myers Squibb ($BMY) and Pfizer's ($PFE) Eliquis. Xarelto has been approved to treat and prevent DVT/PE since 2012, while Pradaxa won that FDA nod in June and Eliquis last month. All of the companies have been plowing resources into promoting the three meds as they jostle for market share.

Mylan sees the Arixtra buy as an addition to its growing portfolio of injectable drugs. Last year, the company bought Agila Specialties, the injectables unit of Strides Arcolab, for $1.6 billion. And it knows what's what with Arixtra: Mylan has already been selling the brand in the U.S. under a distribution deal with Aspen, while Apotex is marketing the authorized generic. The latter will move to Mylan by year's end.

In announcing the deal, Mylan CEO Heather Bresch pointed out that the DVT/PE market is large--about 600,000 patients in the U.S. As an injectable, Arixtra will be marketed to hospitals as well as at the retail level, she said.

Plus, there's solid pricing for both the brand and the generic, ISI Group analyst Umer Raffat wrote in note to investors; the authorized generic trades at just a 14% discount to the brand, he said. Raffat said the deal could add 10 to 15 cents per share to Mylan's earnings next year, but he cautioned that Arixtra might be a "shrinking franchise" because of all the competition from oral blood thinners.

Meanwhile, count on Bresch to continue scouting for buys. The company is said to be among the shoppers for GlaxoSmithKline's ($GSK) portfolio of mature drugs. With Sanofi ($SNY) offering its own basket of older meds for sale, Mylan could be kicking tires there, too.

- read the release from Mylan

Special Report: Top 10 generics makers by 2012 revenue - Mylan

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