Gurnet Point Capital and Patient Square Capital buy Radius Health for $890M

Global pharmaceutical company, Radius Health Inc, announced this week (June 23) that it has entered into a definitive agreement to be bought out by Gurnet Point Capital and Patient Square Capital in a transaction valued at approximately $890 million.

Radius Health is a company focused on addressing unmet medical needs in the areas of bone health, neuro-orphan diseases, and oncology. 

Its lead product, a TYMLOS (abaloparatide) injection, was approved by the U.S. Food and Drug Administration (FDA) for the treatment of postmenopausal women with osteoporosis at high risk for fracture. 

Clinical pipeline

The Radius clinical pipeline includes investigational abaloparatide injection for potential use in the treatment of men with osteoporosis; the investigational drug, elacestrant (RAD1901), for potential use in the treatment of hormone-receptor positive breast cancer out-licensed to Menarini Group; and the investigational drug RAD011, a synthetic cannabidiol oral solution with potential utilization in multiple neuro-endocrine, neurodevelopmental, or neuropsychiatric disease areas, initially targeting Prader-Willi syndrome, Angelman syndrome, and infantile spasms.

The transaction includes the assumption of debt and assuming full payment of the Contingent Value Right (CVR). Debt financing for this transaction will be provided by OrbiMed Advisors, LLC.

Chairman of Radius Health, Owen Hughes, said, “The acquisition of Radius by Gurnet Point and Patient Square provides our shareholders with attractive, immediate value at a compelling premium, in addition to the potential future upside of TYMLOS through the CVR.”

Under the terms of the merger agreement, an entity jointly owned by Gurnet Point and Patient Square will initiate a tender offer to acquire all of the outstanding shares of Radius Health. 

Including the CVR payment, Radius shareholders will receive up to an aggregate of $547 million in cash. The upfront payment at closing represents a premium of 45% over the 30-day volume-weighted average price of Radius’s common stock, and inclusive of the CVR payment, a 59% premium.

Maximizing value

Hughes added: “The announcement of the acquisition, which has been unanimously approved by the Radius board, is the culmination of a thorough and rigorous strategic review process conducted over nine months by the board and management with the assistance of external advisors. We are confident that this transaction maximizes value for shareholders and provides the clearest path forward for Radius.”

Travis Wilson, partner at Gurnet Point, said his company was delighted to be acquiring Radius and providing additional resources to the company during this critical time. 

He said, “We fully believe in the value of the company’s portfolio and are looking forward to working closely with the company to deliver a positive impact for patients.”