Retrophin Announces Agreement to Acquire Manchester Pharmaceuticals

Retrophin, Inc. has signed an agreement to acquire Manchester Pharmaceuticals LLC, a privately-held specialty pharmaceutical company that focuses on treatments for rare diseases. Under the terms of the agreement, Retrophin will pay a total of $62.5 million, including an upfront payment of $29.5 million, plus royalties based on product sales. The transaction is expected to close by 1 March 2014.

Manchester markets two drugs that have been approved by FDA. Chenodal (chenodeoxycholic acid — a synthetic bile acid also known as chenodiol) is indicated for patients suffering from gallstones in whom surgery poses an unacceptable health risk due to disease or advanced age. Vecamyl (mecamylamine HCI tablets) is indicated for the management of moderately severe to severe essential hypertension and uncomplicated cases of malignant hypertension.

Chenodeoxycholic acid is also the standard of care for cerebrotendinous xanthomatosis (CTX), a rare inborn error of cholesterol metabolism that often causes chronic diarrhea in infants and cataracts in childhood or adolescence and ultimately neurodegeneration caused by formation of fatty yellow nodules (xanthomas) in the brain. If untreated, the disease can cause severe intellectual disability and death. FDA granted chenodiol orphan designation for CTX in March 2010. Chenodal is the only FDA-approved chenodeoxycholic acid and is only used for CTX.

"We are delighted to have the opportunity to help patients with CTX, an underdiagnosed and deadly disease," said Martin Shkreli, Founder and Chief Executive Officer of Retrophin. "Almost all patients have avoidable permanent neurological damage, underscoring the need for earlier diagnosis. We also intend to move quickly to pursue FDA approval of Chenodal for CTX."

Providing revenue guidance for the first time, Retrophin expects 2014 revenues to be in the range of $10 million to $12 million, and 2015 revenues in the range of $19 million to $21 million.