Valeant Pharma boosts offer for Obagi to $418M

LONG BEACH, Calif. -- Obagi Medical Products Inc. said Wednesday that Canadian drugmaker Valeant Pharmaceuticals boosted its offer to buy the dermatology products maker, topping a bid made a day ago by a German rival.

Obagi said it struck a deal with Valeant Pharmaceuticals International Inc. that calls for it to pay $24 per share, or a total of about $418.3 million, for the company. The news sent Obagi shares up 10 percent in morning trading.

Obagi said its board has approved the deal and is recommending that stockholders tender their shares in Valeant's offer, which is set to expire on April 23. A spokeswoman for Merz didn't immediately return a call for comment.

The sweetened offer came a day after German drugmaker Merz Pharma Group offered to buy Obagi for $22 per share, or about $383.5 million.

Late last month, Valeant agreed to pay $19.75 per share, or a total of about $343.7 million, for Obagi. Merz said Tuesday that it had been in private talks with Obagi before that deal was announced and wasn't aware that it was considering signing a deal with another company so quickly.

Long Beach, Calif.-based Obagi makes skin anesthetics as well as prescription and over-the-counter treatments for wrinkles, acne, sun damage and other skin problems. It posted sales of $120 million last year.

In morning trading, Obagi shares rose $2.19, or 10 percent, to $25.07, while Valeant's U.S. shares edged up 71 cents to $76.08.

View the original article here

Valeant says generic approval could lower profit

Valeant Pharmaceuticals International Inc. said Thursday that a newly approved generic version of one of its drugs could significantly reduce its profits this year.

Mylan Inc. on Wednesday received final approval from the U.S. Food and Drug Administration to sell the first generic version of Valeant's Zovirax ointment, which is used in the treatment of herpes. It will start shipping the product immediately.

Valeant said that while the timing of the approval wasn't certain, the company knew it was coming and prepared for it. The Canadian company announced plans to launch its own generic version of the drug immediately.

But Valeant said that it didn't factor the approval into its original budget expectations and warned that the event could reduce its 2013 profit by between 30 and 40 cents per share.

It added that other actions, including several product acquisitions and the repricing of its term loan debt, which have taken place since it announced its financial guidance in January, could partially offset the effects of the Zovirax genericization.

Valeant said in January that it expected a 2013 profit of $5.45 to $5.75 per share on $4.4 billion to $4.8 billion in revenue. Analysts polled by FactSet currently expect a profit of $5.63 per share on $4.62 billion in revenue.

The company said Thursday that it will update its 2013 guidance when it releases its first quarter financial results in May.

Valeant's U.S. shares fell $1.81, or 2.5 percent, to $70.06 in morning trading.

View the original article here