Six Irish businessmen will share a $635 million (€542m) payday after selling a company that developed a drug used in the frontline as the United States battles an opioid crisis.
Waterford entrepreneur Seamus Mulligan and his team invested €115 million to set up Adapt Pharma just over four years ago. Their team focused on a drug, Naloxone, that has been in use for many years and is commonly used in hospital anaesthesia.
However, until Adapt Pharma, no company had successfully developed a non-injectable form of the drug, branded as Narcan. Crucially, the company’s nasal spray meant the drug could be used by non-medical personnel.
It was fast-tracked by the US regulator, the FDA, and came on the US market in early 2016 just as the US raised the profile on an escalating problem with opioid drugs such as heroin and fentanyl.
It is now commonly used by police, health workers and even teachers in the US and Canada – helped by the Adapt company decision to offer the drug at discounted prices to federal and state agencies.
Singer’s overdose
The drug hit the headlines this summer when it was used to revive US singer Demi Lovato after she suffered an overdose at her Hollywood Hills home.
US president Donald Trump has declared the opioid drug crisis a public health emergency.
Narcan costs $175 for a pack of two single-dose sprays in pharmacies, but is made available to first responders and other public service workers for $75.
Recent figures from the US Centres for Disease Control suggest as many as 71,000 people died in the US last year from drug overdoses. More than 2 million people in the US alone are thought to be addicted to opioids.
Emergent Biosolutions, a US company that specialises in public health threats, has bought the business. Emergent is best known for its vaccines for killer diseases like anthrax, smallpox, botulism, Ebola and the Zika virus.
It is looking to expand and diversify its portfolio of drugs within what it calls the “public health threats market”.
Emergent is paying $635 million up front – $575 million in cash and $60 million in shares. The Irish businessmen stand to make a further $100 million in cash if Narcan hits certain sales targets between now and 2022.
Narcan sold $25 million in its first year on the market in 2016. That is understood to have risen to more than $80 million last year and is expected to more than double again to $170 million this year.
Emergent has pencilled in sales of between $200 and $220 million in 2019. It has agreed to retain the current pricing structure for the drug.
Mr Mulligan, who owns just over 80 per cent of Adapt, will stay on as a consultant to the new owners when the deal is closed. His executive team will also remain with the new owners.
Sharing windfall
The others sharing in the windfall are chief financial officer David Brabazon, chief operations officer Eunan Maguire*, chief technology officer Fintan Keegan, the company's top US executive Michael Kelly and company secretary James Skehan.
Mr Mulligan, who is chairman and chief executive of Adapt and who came to prominence as head of Elan Drug Technologies, said the deal would allow the companies to focus on the opioid crisis, “the leading public health issue of our time”.
“ With a shared mission of protecting lives from public health threats, I am confident that our combined expertise and resources will accelerate access to Narcan nasal spray through investments in public awareness and manufacturing capacity while maintaining a responsible pricing approach,” he said.
This is a second success for Mr Mulligan and his team, who were all previously involved in the founding of Dublin-based Azur Pharma. This was later sold to Jazz Pharmaceuticals in a deal valued at the time at about $500 million.
* This article was edited on August 30th
