Mallinckrodt Pharmaceuticals to Acquire Therakos for $1.33 Billion

The medtech consolidation wave continued this week with drugmaker Mallinckrodt Plc agreeing to buy immunotherapy company Therakos Inc. in a $1.33 billion deal, its second major acquisition this year to bolster its presence in hospitals.

Therakos is the maker of the Cellex treatment system, which provides immune cell therapies using a process known as extracorporeal photopheresis. The company’s flagship device is approved in the United States for use in the treatment of a blood cancer that affects the skin for patients who have not been responsive to other forms of treatment. It is being used by physicians abroad for the treatment of other conditions, including Crohn’s disease.

Devices based on Therakos’s technology are the world’s only approved fully integrated systems for extracorporeal photopheresis, or ECP, in which blood is treated with a photosensitizing agent and irradiated with light.

Dublin, Ireland-based Mallinckrodt said it would focus on selling more of Therakos’s devices in the United States, where it is approved only for a form of blood cancer. Outside the United States, the device is also used to treat Crohn’s disease, among other applications.

The Gores Group, based in Los Angeles, acquired Therakos from Ortho Clinical Diagnostics, a former unit of Johnson & Johnson, for an undisclosed amount in December 2012. The acquisition of Therakos is the latest in a deal-making binge by Mallinckrodt.

Last year, Mallinckrodt acquired Cadence, a biopharmaceutical company in San Diego, for $1.3 billion and bought Questcor Pharmaceuticals, which is based in Anaheim, Calif., for $5.6 billion. It also acquired Ikaria, a maker of treatments for critically ill infants, for $2.3 billion in March.

“This transaction demonstrates our commitment to building a strong, highly profitable hospital growth business as we build and diversify Mallinckrodt’s Specialty Brands portfolio,” said Mark Trudeau, president/CEO of Mallinckrodt. “In expanding our hospital portfolio we continue to move decisively in line with our strategic roadmap. And we believe we will be able to unlock untapped value in Therakos – making ECP treatment accessible to more patients in more hospitals by applying some of the innovative contract, service and customer intimacy principles that have been successful with our INOMAX (nitric oxide) for inhalation. One of Mallinckrodt’s core strengths is our ability to manage complexity, delivering additional value to diverse products and environments. With this expansion into immunotherapy we add to our footprint of nuclear medicine, pain management, and respiratory neonatal critical care, broadening our touch points in hospitals and further expanding our portfolio with therapies.”