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Belgium Firm to Buy Epilepsy-Focused Biopharma Co. for $1.9B
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Shares of Zogenix Inc. rose by 66% after the company reported it entered into an agreement to be acquired by UCB. S.A. of Belgium for $26.00 per share in cash. The offer includes the potential for an additional $2.00 per share if a specific drug approval milestone is met.

Prior to the open of U.S. markets today, biopharmaceutical company Zogenix, Inc. (ZGNX:NASDAQ), which is focused on developing treatments for epilepsy and other rare diseases, announced that it has entered into a definitive agreement to be acquired by UCB, S.A. (UCB:Euronext-Brussels) for $26.00 per share in cash. The report advised that the $26.00 per share price represents a 72% premium over the trailing 30-day volume weighted average closing price of Zogenix shares.

The offer from UCB also includes a contingent value right (CVR) for an additional potential cash payment of $2.00 per share bringing the total value of the transaction to approximately $1.9 billion (€ 1.7 billion). The report indicated that the CVR will be payable to upon receiving approval from the EU on or before December 31, 2023, for Zogenix's FINTEPLA® which is an orphan medicine used in treating Lennox-Gastaut syndrome (LGS).

The report mentioned that the acquisition has already been unanimously approved by each of the companies' respective boards of directors and is expected to close by the end of Q2/22. The transaction remains subject to approval by a majority vote by Zogenix shareholders (based upon number of shares owned and tendered), ordinary closing conditions and regulatory requirements including necessary antitrust clearances.

UCB believes that the merger and addition of FINTEPLA® to its existing product line will strengthen its role in addressing unmet needs of those diagnosed with specific or rare forms of epilepsy. The report advised that FINTEPLA® has already received both U.S. Food and Drug Administration (FDA) and the European Medicines Agency (EMA) approval for use in treating seizures associated with Dravet syndrome in patients two years of age and older. In addition, the drug has been submitted for regulatory review in Japan for the same indication.

Zogenix noted that it is also actively engaged in development of FINTEPLA® for use treatment of seizures associated with other rare epilepsies including Lennox-Gastaut syndrome (LGS) and CDKL5 Deficiency Disorder (CDD).

UCB is expected to benefit from the acquisition as it believes that Zogenix's medicine pipeline will be a complementary fit with its current objectives and strategy to advance its offering for epilepsy treatments. The addition of Zogenix is expected to bring significant and differentiated value to patients suffering from Dravet syndrome as well as for seizures associated with Lennox-Gastaut syndrome and perhaps even other rare orphan diseases of forms of epilepsy if approvals for those indications are obtained.

Charl van Zyl, EVP, Neurology & Head of Europe/International Markets remarked, "The proposed acquisition of Zogenix reinforces UCB's sustainable patient value strategy and continued commitment to addressing unmet needs of people living with epilepsy with an increasing focus on those living with specific or rare forms of epilepsy, where few options exist. Complementing UCB's existing therapeutic offerings, the Zogenix acquisition provides UCB with an approved medicine for a life-threatening, rare infant- and childhood-onset epilepsy marked by frequent and severe treatment-resistant seizures, that are particularly challenging to treat."

Zogenix's President and CEO Stephen J. Farr, Ph.D. commented, "We are delighted to announce UCB's proposed acquisition of Zogenix, recognizing the value of our lead medicine, both for the important role it has already begun to play for Dravet patients and their caregivers, and for its potential to help many others in the future…We are excited for the potential opportunities ahead of us, working together to accelerate our mission and progress to improve the care of patients in need of new therapies. We believe this transaction is in the best interests of both patients and our shareholders."

FINTEPLA® (fenfluramine) oral solution was described to be "a prescription medication used to treat seizures associated with Dravet syndrome in patients two years of age and older."

The report explained that Dravet syndrome is a rare life-long form of epilepsy that affects approximately 15,700 live births in the U.S. and around one in 20,000 to 40,000 live births in Europe. The condition typically begins in infancy and is characterized by frequent seizures, impairment of developmental, behavioral, and motor skills and presents an elevated risk of sudden unexpected death in epilepsy (SUDEP).

According to the report, "Lennox-Gastaut syndrome (LGS) is a rare and devastating lifelong childhood-onset epilepsy that can arise from multiple different causes that is characterized by many different seizure types, including many that result in frequent falls and injuries."

Zogenix is a global biopharmaceutical company based in Emeryville, Calif. The company is engaged in the development and commercialization of therapies to treat orphan and rare diseases. The company's listed that "its first rare disease therapy, FINTEPLA® (fenfluramine) oral solution, has been approved by the U.S. Food and Drug Administration (FDA) and the European Medicines Agency and is under regulatory review in Japan for the treatment of seizures associated with Dravet syndrome, a rare, severe lifelong epilepsy." The firm is also investigating treatments for Lennox-Gastaut syndrome (LGS), CDKL5 Deficiency Disorder (CDD) and mitochondrial disease.

UCB is a global biopharmaceutical company headquartered in Brussels, Belgium. The company focuses on discovery and development of innovative medicines for treating severe immune and central nervous system diseases. The company generates annual revenues of around €5.3 billion and employs over 8,000 people in about 40 countries.

Zogenix began the day with a market cap of around $875.7 million with approximately 56.99 million shares outstanding and a short interest of about 10.0%. ZGNX shares opened nearly 67% higher today at $26.09 (+$10.45, +66.82%) over yesterday's $15.64 closing price and reached a new 52-week high price this morning of $26.57. The stock has traded today between $25.91 and $26.57 per share and is currently trading at $25.91 (+$10.25, +65.66%).


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