The global pharmaceutical company Organon is acquiring its portfolio company Forendo Pharma.
Forendo Pharma’s shareholders will receive an initial payment of USD 75 million and are entitled to additional future payments totaling USD 870 million upon the achievement of certain development, registration and commercial milestones pertaining to Forendo Pharma’s drug candidates. The total purchase price, if all milestones are met, amounts to USD 945 million.
“The total purchase price, if all milestones are met, amounts to USD 945 million.”
Forendo Pharma is a Karolinska Development’s portfolio company.
The transaction is expected to close in December 2021.
Forendo Pharma’s most advanced drug candidate, FOR-6219, is a clinical stage asset being developed for the treatment of endometriosis – a chronic disease associated with severe abdominal pain and infertility, affecting up to 1 in 10 women of childbearing age.
One of the largest biotech transactions in the Nordic region
“Organon’s acquisition of Forendo Pharma is one of the largest biotech transactions in the Nordic region, hence emphasizing the strength of Karolinska Development’s long-term strategy for value creation. We are pleased and very proud to have contributed to Forendo Pharma’s successful development of drug candidates with potential to improve the lives of millions of women worldwide. The fact that Organon, one of the leading global women’s health companies, has chosen to invest large resources in taking these drug candidates further towards the market underlines the scientific height and quality of the company’s projects,” says Karolinska Development’s CEO Viktor Drvota.
Karolinska Development estimates the risk-adjusted net present value (rNPV) of future cash flows, including the initial payment, from the transaction at SEK 114 million, with a positive effect on net profit of SEK 70 million and a consequential increase in the portfolio company’s fair value of SEK 70 million in the third quarter 2021. The additional purchase consideration is expected to be paid during the period 2024–2034, and renewed rNPV valuations will be performed continuously in connection with Karolinska Development’s future quarterly reporting.