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Cephalon, Inc. and CIMA LABS INC. Announce FTC Clearance to
Proceed with Merger
Transaction Expected to Close Within Days
WEST CHESTER, Pa., and EDEN PRAIRIE, Minn., Aug. 9 /PRNewswire-FirstCall/ --
Cephalon, Inc. (NASDAQ:CEPH) and CIMA LABS INC. (NASDAQ:CIMA) announced today
that the U.S. Federal Trade Commission (FTC) has accepted a consent agreement
that clears the way for Cephalon to complete its acquisition of CIMA. The
companies expect the transaction to close within the next few days.
"By becoming part of Cephalon, we see a tremendous opportunity for the people
at CIMA to continue their excellent efforts to grow our business," Steven
Ratoff, Chairman and interim CEO of CIMA, said. "We are looking forward to
creating a stronger company and to working with the highly motivated and
successful group of people at Cephalon."
Frank Baldino, Jr., Ph.D., Chairman and CEO of Cephalon, said, "We are pleased
with the decision of the FTC, and we look forward to combining CIMA's
operations into our business. We have been successfully serving the pain care
market with ACTIQ for a number of years; we understand the needs of this market
well and the return it can provide. This transaction provides us with a
tremendous opportunity to significantly expand our established pain care
franchise by adding OraVescent(R) fentanyl to our portfolio at a time when
ACTIQ exclusivity expires."
OraVescent fentanyl currently is in Phase III clinical trials for treatment of
breakthrough cancer pain, and Cephalon is targeting approval of this product by
the U.S. Food and Drug Administration (FDA) for late 2006.
OraVescent fentanyl is a tablet that utilizes an enhanced absorption
transmucosal drug delivery technology developed by CIMA that provides for a
rapid onset of pain relief. Cephalon believes that this delivery technology
will be more appealing and will enable greater market penetration than has been
the case with ACTIQ(R) (oral transmucosal fentanyl citrate) [C-II].
Further, Cephalon plans to pursue a broader label for OraVescent fentanyl for
the treatment of pain, which may enable the product to reach several million
more patients. OraVescent fentanyl is protected by a pharmaceutical
composition patent that extends until 2019.
The FTC agreement represents a novel approach to satisfying antitrust concerns.
Instead of being required to divest its existing product, Cephalon retains the
right to continue to market ACTIQ. The company has agreed to grant a license
to Barr Laboratories, Inc. to any remaining intellectual property related to
ACTIQ.
This license will become effective on February 3, 2007 (or September 5, 2006,
if Cephalon does not obtain pediatric exclusivity). However, the license will
become effective earlier if Cephalon obtains FDA approval of OraVescent
fentanyl prior to these dates. Cephalon expects to obtain pediatric
exclusivity, and therefore expects that the license will become effective upon
final FDA approval of OraVescent fentanyl, which is anticipated late in 2006.
Barr also may obtain rights to the sugar-free formulation of ACTIQ, effective
when OraVescent fentanyl is approved. Cephalon expects to file in late 2004 a
supplemental new drug application (sNDA) with the FDA requesting approval for
the sugar-free formulation. The FDA's targeted review period for this sNDA is
four months; Cephalon anticipates final FDA approval in the middle of 2005.
With the closing of this transaction in August, Cephalon expects additional
sales of approximately $15 million and other revenue of approximately $10
million during the remainder of 2004. Therefore, the company is increasing its
2004 sales guidance by $15 million to $915-$965 million, which includes other
product sales of $95-$105 million. The company also is increasing its third
quarter 2004 sales guidance by $5 million to $250-$260 million. Importantly,
the company's previously issued diluted adjusted earnings per share guidance
for the third quarter and full year 2004 remains unchanged.
Cephalon management will discuss the CIMA acquisition with investors during a
conference call beginning at 9:00 a.m. EDT on Tuesday, August 10, 2004. To
participate in the conference call, dial 1-719-867-0660 and refer to Conference
Code Number 565602. Individual investors are encouraged to log onto the
investor relations section of http://www.cephalon.com/ and click on the webcast
to access the live call. Further information concerning the FTC approval
process and the terms of the consent agreement may be found on the Federal
Trade Commission web site at http://www.ftc.gov/.
Cephalon, Inc.
Founded in 1987, Cephalon, Inc. is an international biopharmaceutical company
dedicated to the discovery, development and marketing of innovative products to
treat sleep and neurological disorders, cancer and pain.
Cephalon currently employs approximately 2,000 people in the United States and
Europe. U.S. sites include the company's headquarters in West Chester,
Pennsylvania, and offices and manufacturing facilities in Salt Lake City, Utah.
Cephalon's major European offices are located in Guildford, England,
Martinsried, Germany, and Maisons-Alfort, France.
The company currently markets three proprietary products in the United States:
PROVIGIL(R) (modafinil) Tablets [C-IV], GABITRIL(R) (tiagabine hydrochloride)
and ACTIQ and more than 20 products internationally. Full prescribing
information on its U.S. products is available at http://www.cephalon.com/ or by
calling 1-800-896-5855.
CIMA LABS INC.
CIMA develops and manufactures prescription and over-the-counter products based
upon its proprietary, orally disintegrating drug delivery technologies,
OraSolv(R) and DuraSolv(R). Based on these technologies, an active drug
ingredient, which the company frequently taste-masks, is formulated into a new,
orally disintegrating dosage form that dissolves quickly in the mouth without
chewing or the need for water. CIMA's business involves a dual operating
strategy. The company develops and manufactures orally disintegrating versions
of drugs for pharmaceutical company partners for whom CIMA currently produces
three branded prescription pharmaceuticals and four over-the-counter brands.
CIMA is also developing proprietary products utilizing its orally
disintegrating technologies, as well as its new OraVescent(R) enhanced
absorption, transmucosal drug delivery system. Further information about CIMA
is available at http://www.cimalabs.com/.
In addition to historical facts or statements of current condition, this press
release may contain forward-looking statements. Forward-looking statements
provide Cephalon's and CIMA's current expectations or forecasts of future
events. These may include statements regarding the expected timing of the
closing of the merger between Cephalon and CIMA, the targeted approval date of
OraVescent fentanyl, the expected filing date of the sNDA for the sugar-free
formulation of ACTIQ and the related anticipated date of FDA approval,
Cephalon's ability to significantly expand its pain care franchise with
OraVescent fentanyl, its belief that the delivery technology of OraVescent
fentanyl will be more appealing and will enable greater market penetration and
its plans to pursue a broader label for OraVescent, the expected date of the
effectiveness of the Barr license, anticipated scientific progress on the
companies' respective research programs, development of potential
pharmaceutical products, interpretation of clinical results, prospects for
regulatory approval, including OraVescent fentanyl and the sugar-free
formulation of ACTIQ, manufacturing development and capabilities, market
prospects for the companies' products or product candidates, sales and earnings
guidance, and other statements regarding matters that are not historical facts.
You may identify some of these forward-looking statements by the use of words
in the statements such as "anticipate," "estimate," "expect," "project,"
"intend," "plan," "believe" or other words and terms of similar meaning.
Cephalon's and CIMA's respective performance and financial results could differ
materially from those reflected in these forward-looking statements due to
general financial, economic, regulatory and political conditions affecting the
biotechnology and pharmaceutical industries as well as more specific risks and
uncertainties facing Cephalon and/or CIMA such as those set forth in their
respective reports on Form 8-K, 10-Q and 10-K filed with the U.S. Securities
and Exchange Commission. Given these risks and uncertainties, any or all of
these forward-looking statements may prove to be incorrect. Therefore, you
should not rely on any such factors or forward- looking statements.
Furthermore, neither Cephalon nor CIMA intend to update publicly any
forward-looking statement, except as required by law. The Private Securities
Litigation Reform Act of 1995 permits this discussion.
DATASOURCE: Cephalon, Inc.
CONTACT: Investor Contact: Chip Merritt, +1-610-738-6376,
, or Media Contact: Robert Grupp, +1-610-738-6402,
, both of Cephalon; or James Hawley of CIMA,
+1-952-947-8700,
Web site: http://www.cimalabs.com/
Web site: http://www.cephalon.com/
Company News On-Call: http://www.prnewswire.com/comp/134563.html