An ex-Vant further immerses itself in a new umbrella, cashing out in a $584M M&A deal with Sumitomo Dainippon subsidiary
A former Vivek Ramaswamy biotech is being brought closer into its new owner’s family of companies.
Sumitovant, the umbrella subsidiary of Sumitomo Dainippon that bought five of Ramaswamy’s “Vants” in September 2019, is planning on fully acquiring Urovant Sciences $UROV for $584 million in an all-cash deal, the companies announced Thursday afternoon. The merger values Urovant at $16.25 per share, a 96% premium on the biotech’s closing price of $8.28 on Thursday.
Investors jumped at the news, with the stock soaring 93% in after-hours trading to nearly meet that premium. The deal is expected to close sometime in the first quarter of 2021, and prior to the acquisition, Sumitovant owned a roughly 72% stake in Urovant.
Urovant — focusing on urinary diseases — was among the five biotechs that Ramaswamy sold off to Sumitomo Dainippon a little over 14 months ago, a group that included Myovant (women’s health and prostate cancer), Enzyvant (pediatric rare diseases), Altavant (respiratory rare diseases) and Spirovant (pulmonary diseases). The 2019 deal brought in $3 billion for Ramaswamy, and included the option of buying another 6 of his startups.
After that transaction closed, Sumitomo Dainippon established Sumitovant in December 2019 as the new parent company to manage the Vants. Under Thursday’s acquisition, Urovant will merge with a subsidiary of Sumitovant and become wholly owned by the company.
Urovant’s primary drug candidate is vibegron, whose date at the FDA is right around the corner on Dec. 26. That could set up a launch in early 2021, CEO James Robinson said in a statement.
Vibegron is a once-a-day pill that aims to treat overactive bladder. A beta-3 agonist, vibegron claimed a Phase III win back in March 2019 when it hit both co-primary endpoints and 7 secondary endpoints compared to placebo. But questions remained over its potential efficacy over a cheap generic called tolterodine used as an active comparator, sending Urovant’s stock down at the time.
Despite vibegron achieving “numerically better efficacy than tolterodine,” researchers did not run a p-value for the Urovant drug against the generic. Ramaswamy originally bagged the drug in a small $25 million deal from Merck, and Urovant is also evaluating it in OAB in men with benign prostatic hyperplasia and for abdominal pain associated with irritable bowel syndrome.
Should the FDA wave through vibegron next month, it would become one of the multiple drugs within the Sumitovant umbrella that Ramaswamy predicted would reach approval by 2022. Ramaswamy remains on the board of Sumitovant.
Urovant has a gene therapy program also in the pipeline called hMaxi-K, which is being researched for patients with OAB symptoms who have failed oral pharmacologic therapy.