PRINCETON, N.J. - ANI Pharmaceuticals, Inc. (NASDAQ: NASDAQ:ANIP) has entered into a definitive agreement to purchase Alimera (NASDAQ:ALIM) Sciences Inc. (NASDAQ: ALIM) for an upfront payment of approximately $381 million. The transaction, approved by both companies' Boards of Directors, is slated to close in late Q3 2024, subject to customary closing conditions and shareholder approval.
ANI Pharmaceuticals, a diversified biopharmaceutical company, intends to strengthen its Rare Disease segment through this acquisition, which is expected to add about $105 million in branded revenue. Alimera Sciences , a global pharmaceutical firm, brings to the table two commercial products, ILUVIEN and YUTIQ, which are treatments for ocular conditions.
ANI's President and CEO, Nikhil Lalwani, emphasized the transaction's alignment with ANI's strategy to bolster its Rare Disease business and expand its ophthalmology footprint. The acquisition is anticipated to be accretive to ANI's adjusted non-GAAP EPS by a high single-digit to low double-digit percentage in 2025, with substantial growth expected thereafter.
The deal includes a cash payment of $5.50 per share at closing and a non-tradable contingent value right (CVR) of up to $0.50 per share, subject to the achievement of certain net revenue targets in 2026 and 2027. ANI also plans to assume $72.5 million of Alimera's debt as part of the agreement.
Alimera's President and CEO, Rick Eiswirth, expressed confidence that the agreement would create value for shareholders and enhance the company's mission of maintaining a better vision for patients.
ANI expects the transaction to generate an additional $35 to $38 million in 2025 adjusted non-GAAP EBITDA, inclusive of approximately $10 million in identified cost synergies. The acquisition is also set to increase geographic diversification with Alimera's established operations outside the U.S., including direct marketing operations in Europe.
The transaction will be financed through a combination of cash on hand and debt financing, with $280 million in committed financing from J.P. Morgan and Blackstone (NYSE:BX) Credit & Insurance.
In other recent news, Alimera Sciences has reported a significant increase in its Q1 2024 financial results. The company's consolidated global net revenue rose by 70% to $23 million, compared to Q1 2023, largely due to the acquisition of YUTIQ and increased global end-user demand. Alimera also turned its financial situation around, shifting from a loss in the previous year to a positive adjusted EBITDA of $1.8 million.
The company's US segment experienced a 92% increase in net revenue, reaching $14.6 million, while international revenue grew by 42%. These developments are attributed to the YUTIQ acquisition and a 96% increase in US end-user demand. Meanwhile, the company's outlook for the future is positive, with a revenue target of over $105 million and an adjusted EBITDA margin of at least 20% for the full year.
Despite the robust growth, Alimera Sciences reported a net loss of approximately $6.3 million in Q1 2024, mainly due to sales, marketing, and amortization expenses from the YUTIQ acquisition. However, the company's clinical trials are progressing well, with the Phase 4 synchronicity study enrollment target met and positive outcomes from the YUTIQ CALM registry study.
The company's focus remains on growing ILUVIEN and YUTIQ utilization, with a strong belief in international market success indicating potential in the US.
InvestingPro Insights
As ANI Pharmaceuticals aims to enhance its Rare Disease segment with the acquisition of Alimera Sciences, a closer look at Alimera's financials provides a clearer picture of the company's current standing. Alimera Sciences, which trades under the ticker NASDAQ: ALIM, has a market capitalization of $165.02 million, reflecting its size in the biopharmaceutical industry. Despite not being profitable over the last twelve months, Alimera has shown a significant revenue growth of 61.75% in the last twelve months as of Q1 2024. This growth trajectory is underscored by a remarkable gross profit margin of 86.52% during the same period, suggesting strong pricing power or cost control measures in place.
InvestingPro Tips highlight that Alimera's gross profit margins are impressive, which could be a positive sign for ANI Pharmaceuticals in terms of potential profitability post-acquisition. However, analysts do not anticipate Alimera to be profitable this year, indicating that ANI's strategy may need to account for short-term financial support or restructuring to realize long-term gains. Additionally, Alimera's liquid assets exceed its short-term obligations, which may provide some financial flexibility during the integration process with ANI Pharmaceuticals.
For investors looking to delve deeper into Alimera's financials and future prospects, InvestingPro offers additional insights and tips. There are currently 6 more InvestingPro Tips available that could provide valuable context for understanding the implications of this acquisition on both companies' futures. To explore these insights, visit https://www.investing.com/pro/ALIM and take advantage of the special offer using the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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