Healthcare Industry News: Allergan
News Release - February 22, 2007
Allergan Announces Its Acquisition of EndoArt, a Leading Swiss Developer of Remote-Controlled Medical DevicesNew Technology Represents Next-Generation in Gastric Banding Systems for Obesity Treatment
IRVINE, Calif.--(HSMN NewsFeed)--Allergan, Inc. (NYSE:AGN ) today announced the completion of its acquisition of Swiss medical technology developer EndoArt SA, a leader in the field of telemetrically-controlled (or remote-controlled) implants used in the treatment of morbid obesity and other conditions. The acquisition builds upon the strength of Allergan's existing obesity intervention product portfolio, which includes the LAP-BAND® Adjustable Gastric Banding System, currently the only adjustable implant device for individualized weight loss approved in the United States and a leading bariatric procedure worldwide; and the BIB(TM) BioEnterics® Intragastric Balloon, a non-surgical alternative for the treatment of obesity approved in many countries although not currently available in the United States.
Allergan paid $97 million, net of excess cash, for the EndoArt shares in an all cash transaction. Allergan will not alter financial guidance for 2007 as a result of the transaction. Estimates of any costs that will be excluded from Allergan's adjusted earnings per share will be provided at the time of Allergan's first quarter 2007 Earnings Release. It is anticipated that a substantial portion of the acquisition purchase price will be expensed by Allergan as in-process research and development, with the balance of the purchase price being allocated to other identifiable tangible and intangible assets acquired, including developed and core technologies, liabilities assumed and goodwill. An independent third-party valuation firm has been engaged to assist Allergan in determining the estimated fair values of the acquired intangible assets, including in-process research and development.
The acquisition gives Allergan ownership of EndoArt's proprietary technology platform, including FloWatch® technology, which powers the EASYBAND® Remote Adjustable Gastric Band System, a next-generation, telemetrically-adjustable gastric banding device for the treatment of morbid obesity. The EASYBAND® device is surgically implanted around the upper stomach and can be adjusted when necessary according to each patient's individual weight loss needs and results using a simple external control unit placed over the device. The control unit transmits power and commands to, and receives information from, an implanted antenna connected to the EASYBAND®, which can then be adjusted precisely and in just minutes.
"This acquisition is representative of our commitment to actively pursue the development and commercialization of next-generation products and technologies capable of providing high-quality, healthier and less traumatic weight-loss treatment solutions to patients, physicians, governments, employers and health care payers," said David E.I. Pyott, Allergan's Chairman of the Board and Chief Executive Officer. "We also believe that this proprietary technology has exciting potential across a broad range of other medical device applications and disease categories, such as urology and gastroenterology."
"We are very pleased to be joining Allergan in its effort to address the serious immediate and long-term consequences of the worldwide obesity epidemic - an effort that will benefit from the depth and breadth of Allergan's investment in the research, development and commercialization of next-generation products and technologies," said Philippe Dro, Chief Executive Officer and Chairman of EndoArt.
EASYBAND® Gastric Banding System was approved by the European Commission for use in Europe in mid-2006. Allergan anticipates seeking U.S. Food and Drug Administration (FDA) approval of the device following completion of clinical studies that will be conducted in the United States. Allergan also is establishing EndoArt's facility in Lausanne, Switzerland as an international center of excellence for research and development in obesity-related disorders.
This press release contains "forward-looking statements", including, among other statements, the statements by Messrs. Pyott and Dro, and statements regarding the business combination between Allergan and EndoArt. Statements made in the future tense, and words such as "expect", "believe", "will", "may", "anticipate" and similar expressions are intended to identify forward-looking statements. These statements are based on current expectations of future events. If underlying assumptions prove inaccurate or unknown risks or uncertainties materialize, actual results could vary materially from Allergan's expectations and projections. Risks and uncertainties include, among other things, general industry and market conditions; technological advances and patents attained by competitors; challenges inherent in the research and development and regulatory processes; challenges related to product marketing, such as the unpredictability of market acceptance for new products and/or the acceptance of new indications for such products; inconsistency of treatment results among patients and the potential for product failures; unknown risks associated with the investigational devices that are the subject of Allergan's clinical trials; potential difficulties in manufacturing new products; and governmental laws and regulations affecting domestic and foreign operations. Risks and uncertainties relating to the EndoArt acquisition include that the anticipated benefits and synergies of the transaction will not be realized, that FDA approval of the EASYBAND® will not be obtained or will be significantly delayed, that the other research and development milestones will not be achieved, and that the integration of EndoArt's operations with Allergan will be materially delayed or will be more costly or difficult than expected. These risks and uncertainties could cause actual results to differ materially from those expressed in or implied by the forward-looking statements, and therefore should be carefully considered. Allergan expressly disclaims any intent or obligation to update these forward-looking statements except as required to do so by law.
Additional information concerning these and other risk factors can be found in press releases issued by Allergan, as well as Allergan's public periodic filings with the Securities and Exchange Commission, including the discussion under the heading "Risk Factors" in Allergan's 2005 Form 10-K, Allergan's Form 10-Q for the quarter ended March 31, 2006, Allergan's Form 10-Q for the quarter ended June 30, 2006 and Allergan's Form 10-Q for the quarter ended September 29, 2006. Copies of Allergan's press releases and additional information about Allergan is available on the World Wide Web at www.Allergan.com or you can contact the Allergan Investor Relations Department by calling 1-714-246-4636.
About Allergan, Inc.
With more than 55 years of experience providing high-quality, science-based products, Allergan, Inc., with headquarters in Irvine, California, discovers, develops and commercializes products in the ophthalmology, neurosciences, medical dermatology, medical aesthetics, obesity intervention and other specialty markets that deliver value to its customers, satisfy unmet medical needs, and improve patients' lives.
About EndoArt SA
EndoArt SA, a privately owned Swiss-based medical technology company founded in 1998 in Lausanne, Switzerland, specializes in the research and development of telemetrically-controlled (or remote controlled) implants. Historical funding for the company was provided by leading European venture firms such as Sofinnova Partners (France), Trans Atlantic Technology (Switzerland) and local Banque Cantonale Vaudoise. The last financing round was lead by VI Partners (Switzerland) and Rennaissance (Switzerland) with EMBL Venture (Germany) and Genevest (Switzerland) as co-investors.
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