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(Alliance News) - Hikma Pharmaceuticals PLC on Friday said it has acquired a manufacturing programme and two pipeline products from Insys Therapeutics Inc for an undisclosed sum.
The FTSE 250 stock was up 7.4% at 1,976.50 pence in London in morning trade.
Insys filed for bankruptcy in the US in June and initiated the sale of its assets. Of these, Hikma has agreed to buy "unit-dose nasal and sublingual spray manufacturing equipment, as well as two pipeline products". The pipeline products are epinephrine 505(b)2 nasal spray and naloxone 505(b)2 nasal spray.
Naloxone is a drug that can "block or reverse the effect of opioids" and is used to prevent overdose deaths. Presently, Narcan is the only nasal form of naloxone available on the market. Hikma cited data science firm IQVIA Holdings Inc as estimating US Narcan sales for the 12 months to June 2019 at around USD164 million.
Epinephrine, meanwhile, has a number of medical uses including as a treatment for bleeding, cardiac arrest, and anaphylaxis. There are no nasal forms of epinephrine approved in the US.
"According to IQVIA, US sales of epinephrine auto-injectors were approximately USD4.3 billion in the 12 months ending June 2019", Hikma said.
Hikma did not disclose what it had paid under its asset purchase agreement with Insys.
Brian Hoffmann, president of Generics at Hikma, said: "Hikma is the largest supplier of generic nasal sprays in the US and we have been looking for ways to build upon our strong manufacturing platform and expand our product portfolio. This acquisition adds unit-dose nasal spray manufacturing equipment, as well as two complex products to our pipeline. This new technology expands our existing nasal spray capabilities, creating a comprehensive platform, which we can leverage for both internal and partnership programmes."
Earlier Friday, Hikma reported a 60% jump in pretax profit for the six months ended June 30 to USD226 million from USD141 million, as revenue climbed 7.3% to USD1.05 billion from USD979 million.
Generics led the charge, with revenue up 11% to USD368 million from USD332 million, benefiting from in-market product demand and recent launches. Generics launched two products in the first half, and the company's repeat study for a generic form of asthma and COPD drug Advair Diskus. New data will be submitted to the US Food & Drug Administration by the end of the year.
On the strength of its first half performance, Hikma said Generics revenue now is expected to be in the range of USD690 million to USD720 million with a core operating margin for the division of between 16% and 18%. This compares to prior guidance for USD650 million to USD700 million of Generics revenue and a core operating margin in the mid-teens. In the first half, the core operating margin was 19%, having been 9% the year before.
Injectables also performed well, with revenue up 5.4% to USD432 million from USD410 million. Hikma lifted its Injectables guidance as well, now forecasting that revenue will be at the higher end of 2019 expectations, between USD870 million and USD900 million. Prior guidance was for between USD850 million to USD900 million. The core operating margin is expected to be in the 36% to 38% range, having been 35% to 38% previously. First half core operating margin was 39%, down from 42% previously.
Hikma is recommending a 14 US cents per share interim dividend, up 17% from 12 cents per share a year before.
Chief Executuive Siggi Olafsson said: "All of our businesses are performing well. We are delivering more from our unique and diversified business model, leading market positions and high-quality operations to drive strong organic growth. Our good half-year financial results demonstrate the breadth and resilience of our marketed portfolio, successful pipeline launches and actions we've taken to reduce costs and increase efficiencies. During the first half, we continued to focus on pipeline development. We increased investment in our R&D programmes, added new products through partnerships and strengthened our R&D team.
"I am very pleased with our first half performance, and the increase in our full year guidance reflects our confidence for the remainder of the year."
