Canada-based Valeant Pharmaceuticals announced on August 20 that it had entered into a definitive agreement to buy Sprout Pharmaceuticals for $1bn, with the opportunity for Sprout to enjoy a share of future profits. Sprout’s newly released flibanserin has caused stir in the hours since its approval, and the treatment for generalised Hypoactive Sexual Desire Disorder (HSDD) has been nicknamed the “female Viagra”.
Whether the drug will be accepted en-masse
News of the deal emerged just over 24 hours after the FDA approved the Sprout pill, to be marketed under the brand name Addyi. “Delivering a first-ever treatment for a commonly reported form of female sexual dysfunction gives us the perfect opportunity to establish a new portfolio of important medications that uniquely impact women,” wrote Valeant’s Chairman and Chief Executive J. Michael Pearson in a statement. “We applaud the efforts of the Sprout team to address this important area of unmet need and look forward to working with them to bring the benefits of Addyi to additional markets around the world.”
The pink pill is scheduled for release in the US in the fourth quarter of this year, and is aimed at women who experience emotional stress due to low sexual desire. Whether the drug will be accepted en-masse is uncertain, though Addyi will likely benefit from the scale of Valeant’s marketing operations. Studies have shown that the effect of the pill is marginal, and the side effects – namely low blood pressure – have turned some consumers off the drug already.
Under the terms of the deal, Valeant will offload $500m upon the transaction’s closing, expected September, and hand the remaining $500m to Sprout in the opening quarter of 2016. “This partnership with Valeant allows us the capacity to now ensure broader, more affordable access to all the women who have been waiting for this treatment,” said Sprouts chief executive Cindy Whitehead. “Beyond building this in the United States, Valeant also offers us a global footprint that could eventually bring Addyi to women across the globe.”