Vanda evaluating options, including sale, sources tell Reuters


Vanda Pharmaceuticals is a small drugmaker. Its two central nervous system drugs generated only about $100 million in sales last year. But with lots of M&A dollars being thrown around these days, its execs figure it is worth scoping out a possible sale.

That is what sources tell Reuters, which in an exclusive today said Vanda is in talks with investment banks about getting an advisor to help it sort out its options, including a possible sale. The company has been in this spot before, and lots of companies go through the exercise, so there is no assurance it will move forward.

Still, the fact that Vanda, which markets neurological drugs, is looking around, is an indication of how active pharma M&A has been of late. The word that it was talking to bankers was enough to kick its shares up 16% Thursday, Reuters points out, before they closed up 7% to $16.62. Its shares continued to edge up in trading this morning.

Vanda has two approved drugs, Hetlioz, which treats a sleep disorder in blind people, and Fanapt, an antipsychotic drug that never quite lived up to its promise. In Q2, Vanda reported $17.4 million in Hetlioz sales and $18.6 million in Fanapt sales. The company reported a net loss for the quarter of $4.6 million.

There have been several other small drugmakers looking at options their lately, which may be giving the Washington, DC-based company some encouragement, Reuters says. One of those, Depomed, maker of pain drug Nucynta, has decided to look for a buyer at the urging or investors who believed the company was way undervalued.

And of course, there is the fact that Allergan, which is big in the central nervous system space, just pocketed $40 billion though the sale of its generic portfolio to Teva and is looking for M&A targets. There have been lots of rumors it might take a shot at hep C drug hot shot Gilead Sciences, whose valuation is way off its high as sales have weakened in the face of competition. That would be a deal that would exceed $100 billion, more of a megadeal.

- read the Reuters story

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