Ireland-domiciled Jazz Pharmaceutical is apparently sold as the first developer of what is the first and only U.S. Food and Drug Administration (FDA) approved prescription cannabidiol-based medicine. Spending what will be $7.2 billion in cash and stock for GW Pharmaceuticals, GW shareholders will receive $220 for each share of stock in possession. The deal terms come down to $200 in cash and $20 in Jazz stock. This represents a 50% premium over GW’s Feb 2 stock price closing. The company now diversifies further into neurosciences, picking up product, pipeline and deep cannabidiol expertise.
Why is Jazz Pharmaceuticals, which specializes in sleep disorder and oncology making this purchase?
Diversification—Jazz seeks to bolster and strengthen its neuroscience portfolio.
What does GW develop?
Their leading product is called Epidiolex; the product is approved for a group of rare conditions, involving early-onset epilepsy including the treatment of seizures associated with Lennox-Gastaut Syndrome, Dravet Syndrome and Tuberous Sclerosis Complex. Derived from cannabinoid, Epidiolex is approved by both the European Medicines Agency and the U.S FDA.
What else does Jazz access?
The company now gains access to the underlying intellectual property, know-how and talent housed at GW including a scientific platform and cannabinoid product pipeline in addition to expertise associated with manufacturing. Another promising multiple sclerosis and spinal cord injury drug—nabiximols—is in late stage testing.
Is the deal completed?
No. The boards of the two companies must give the positive nod, which is expected by Q2 2021.
About Jazz Pharmaceuticals
Jazz Pharmaceuticals operates in Palo Alto, CA (Silicon Valley) as well as in Philadelphia and elsewhere with 1,600 employees around the world. The company targets revenue of $2.3 billion in 2020.