Specialty pharmaceutical company, Jazz Pharmaceuticals plc (JAZZ - Free Report) recently signed a definitive agreement with Meda Pharmaceuticals Inc., the US subsidiary of Meda AB, for the sale of its women’s health business.
As per the terms of the deal, Meda will take over a portfolio of six out of eight drugs from Jazz Pharma’s women’s health business for $95 million in cash. Meda will also offer employment to approximately 60 employees of Jazz Pharma to join its work force.
The drugs to be divested by Jazz include Elestrin, indicated for the treatment of hot flushes in menopausal women.
Other drugs for sale are Gastrocrom, Natelle One (prenatal vitamin), AVC Cream, Gesticare DHA (prenatal multi-vitamin) and Urelle (urinary antiseptic).
Jazz Pharma reported net sales of $30.4 million in 2011 from the above mentioned portfolio of six drugs.
Subject to the necessary conditions, the transaction is expected to close in the fourth quarter of 2012. the company expects to book a non-recurring profit in the fourth quarter of 2012, following the sale of the women’s health business.
The company will provide additional details regarding the financial impact of the deal once the sale goes through. The sale of the women’s health business should allow Jazz Pharma to focus on its core areas like narcolepsy, oncology, pain and psychiatry.
We note that Jazz Pharma was in the news recently with a new patent related to its oral solution Xyrem, which is indicated for the treatment of cataplexy and daytime sleepiness in patients diagnosed with narcolepsy.
The new patent is the eighth patent of Xyrem, listed in the Food and Drug Administration’s (FDA) Orange Book. It will expire in December 2019.
Currently, we have a Neutral recommendation on Jazz Pharmaceuticals. However the stock carries a Zacks #2 Rank (short-term Buy rating).