Swiss drug maker Novartis AG’s move to take full ownership of Alcon Inc. is “an intriguing effort” to diversify and expand, according to an article on Forbes’ Investopedia Web site.
Alcon makes eye surgical devices and employs about 800 people in Irvine at its Alcon Research Ltd. unit on Alton Parkway.
The company, with its headquarters in Switzerland and U.S. base in Texas, also makes eye drugs and contact lens solutions and competes with homegrown eye and skin drug maker Allergan Inc.
Two years ago, Novartis bought 25% of Alcon from fellow Swiss company Nestlé SA. Earlier this month, the drug maker said it was exercising an option to buy 52% more of Alcon for $28.1 billion, which would bring its total to 77%.
The deal could close in the second half of the year.
After that, Novartis is looking to buy the remaining 23% of Alcon through a stock-for-stock deal that would give Alcon shareholders 2.8 shares of Novartis for each Alcon share.
Alcon independent directors have criticized the proposal and said Novartis has attempted to circumvent protections for minority shareholders.
“At first glance, this deal appears to make sense for Novartis, although Alcon minority shareholders are probably not that enthused at this point,” Investopedia author Billy Fisher said. “We could see more drama before this deal is completed.”
Kenneth Lickel, an Alcon vice president who runs the company’s Irvine site, likes the idea of being part of Novartis.
“I think it’s ideal, personally,” Lickel told the Business Journal in an earlier interview. “Novartis is in the medical industry, whereas Nestlé is not. I think Novartis will have a better appreciation of what our business is about and what our needs are.”
Nearly 90% of Alcon’s $7 billion in yearly sales comes from drugs and surgical products. Buying Alcon gives Novartis access to Alcon’s cataract surgery products and the Travatan drug for treating glaucoma.
Fisher said he expects to see more acquisitions by large drug makers as 2010 rolls on.
Medical Office Deal
A healthcare real estate investment fund of Santa Ana’s Grubb & Ellis Co. bought a 36,600-square-foot, two-building medical office complex in Sartell, Minn.
The price was $6.5 million, according to a Securities and Exchange Commission filing.
The Center for Neurosurgery and Spine building is within a few miles of St. Cloud Hospital, a 393-bed facility. The center is fully leased to five tenants, including Central Minnesota Neurosciences, the Center for Pain Management and Central Minnesota Center for Diagnostic Imaging.
Grubb & Ellis said its healthcare fund is seeking to raise up to $3 billion to buy more real estate, primarily medical office buildings and other healthcare-related facilities.
Endologix Court Win
A U.S. District Court judge has granted a request by Irvine medical device maker Endologix Inc. to put on hold a patent lawsuit brought against it last year by a rival.
Endologix, which makes devices to stop ballooning blood vessels, said earlier this month that the U.S. Trademark and Patent Office granted its request to reexamine two patents that are being disputed in a lawsuit filed by Cook Medical Inc. of Bloomington, Ind.
Those patents cover endovascular stent grafts, which are devices used to repair arterial aneurysms. Endologix is asking officials to reconsider whether the patents should have been awarded to Cook in the first place.
In a statement, John McDermott, Endologix’s chief executive, said that in about 75% of reexaminations, patent claims were cancelled or modified, “so we look forward to the patent office scrutinizing Cook’s patents.”
Stroke Research
Researchers at the University of California, Irvine, have found a small protein that completely restored movement in the limbs of paralyzed rats.
Two studies by UC Irvine biologists found that transforming growth factor alpha, a protein that naturally occurs in humans, restored movement in rats after they suffered strokes.
The study found that if the protein’s injected into the brain, 99% of lost movement was restored. If given through the nose, 70% of function was restored, according to researchers.
“Now we have evidence that there may be therapies that can repair damage to a significant degree long after the stroke,” said James Fallon, UCI psychiatry and human behavior professor and the studies’ coauthor, in a statement. “It’s a completely unexpected and remarkable finding, and it’s worth trying in humans.”
Results of the studies were published in a pair of academic journals, Neuroscience and the Journal of Stroke & Cerebrovascular Diseases.
Spectrum Trials
Spectrum Pharmaceuticals Inc. said earlier this month that it completed enrollment in the second of two third-phase clinical trials for its apaziquone bladder cancer drug candidate. Irvine-based Spectrum is receiving a $1.5 million milestone payment from Allergan, its development partner for apaziquone.
