GE Capital Provides Facility for Concordia’s Zonegran Buy
Concordia Healthcare announced its subsidiary entered into a definitive agreement with Eisai to acquire Zonegran for commercialization and sale in the U.S., including Puerto Rico.
In accordance with the agreement, the company entered into a commitment letter with GE Capital, GE Capital Markets and GE Capital Markets (Canada) whereby GE Capital agreed to provide an incremental senior secured credit facility of up to $95 million by way of an amendment and restatement of the existing credit agreement among GE Capital, Healthcare Financial Services, as agent, the company, as borrower, certain credit parties party thereto and certain lenders party thereto, dated May 14, 2014.
“The acquisition of Zonegran for commercialization in the United States and Puerto Rico represents another advancement in the execution of Concordia’s legacy product strategy, which management believes will provide significant and sustainable revenue going forward,” said Mark Thompson, CEO of Concordia.
Zonegran was first approved by the U.S. FDA in March 2000 indicated for adjunctive therapy in the treatment of partial seizures in adults with epilepsy. It is available in 25mg and 100mg capsules. Zonegran is a registered trademark of Sumitomo Dainippon Pharma and licensed exclusively to Eisai.
The company has agreed to acquire Zonegran for $90 million in cash, plus approximately $1.5 million for purchased inventory. Completion of the acquisition is subject to customary closing conditions (including receipt of required regulatory approvals and third party consents). Management plans to pay for the acquisition through debt financing.
All obligations of the company under the incremental term loan will be secured by existing first priority perfected security interests in the assets of the company and the assets of its subsidiaries. The incremental term loan is subject to a number of customary conditions, including the requirement that the requisite number of lenders under the existing credit agreement consenting to the amendment and restatement of the existing credit agreement to include the incremental term loan.
Torreya Partners is acting as financial advisor to Concordia.
Concordia is a diverse healthcare company focused on legacy pharmaceutical products, orphan drugs and medical devices for the diabetic population.