Lundbeck secures growth opportunities through strategic acquisition

The recent acquisition in the pharmaceutical industry brings Lundbeck into the spotlight, as the company plans a multi-billion dollar transaction. The acquisition, which has an equity value of approximately 2.6 billion dollars and a net cash value of 2.5 billion dollars (about 17 billion Danish kroner) on a fully diluted basis, is expected to be completed in the fourth quarter of 2024. In the biopharmaceutical sector, Longboard Pharmaceuticals is attracting attention with its highly valued epilepsy assets. Known in the biopharma industry for its innovative development of drugs for neurological disorders, Longboard has recently made significant progress with its leading compound, Bexicaserin. This medication is currently being developed for various neurological indications and has recently received recognition from the FDA as a rare pediatric disease and as an orphan drug for Dravet syndrome. Last month, Longboard published interim results from its ongoing 52-week open-label extension of the PACIFIC study, investigating Bexicaserin in participants with developmental and epileptic encephalopathies (DEEs). Additionally, the company initiated a global Phase 3 study for Bexicaserin to treat seizures associated with Dravet syndrome. With the planned integration of Bexicaserin into its portfolio, Lundbeck is expanding its product pipeline with a promising mid-to-late-stage development drug. The anticipated global peak sales are expected to range between 1.5 and 2 billion dollars, which could sustainably diversify Lundbeck's revenue growth. The expected market entry in the fourth quarter of 2028 is already firmly in sight. Following the completion of the acquisition, Lundbeck will focus more on debt reduction. Within 18 to 24 months, the debt ratio is expected to decrease to below 2.5x NIBD/EBITDA. For 2024, the company anticipates integration costs of about 80 million dollars (approximately 550 million Danish kroner), which will be considered in the adjusted EBITDA. Recently, Longboard Pharmaceuticals' stock experienced an impressive growth of 51.3%, reaching a price of 58.84 dollars in pre-market trading.