Pharma BD Deal Intelligence

Horizon Pharma plc / Raptor Pharmaceutical Corp.

2016 · Acquisition/Merger · $860M · Complete

Horizon Pharma's ~$800M acquisition of Raptor Pharmaceutical for Procysbi and Quinsair was a mixed bag: Procysbi endured as a durable orphan-drug contributor, but Horizon sold EMEA rights to both drugs to Chiesi for just $70M within eight months, and Quinsair's remaining sales collapsed roughly 90% after that carve-out.

CALLED IT — OFF BY 17

One durable niche orphan drug (Procysbi) justified a fraction of the price; the rest of what was paid for (Quinsair, Raptor's pipeline) evaporated within a year or two of close.

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The coverage arc

Sep 12, 2016 Fierce Biotech Neutral

Fierce Biotech flagged that while the deal expanded Horizon's rare-disease franchise, Raptor's pipeline had suffered repeated clinical failures (notably the…

Sep 13, 2016 Pharmacy Times Bullish

Pharmacy Times framed the deal as accelerating Horizon's transformation into a rare-disease specialist, with Procysbi adding a long-tail patent-protected…

Oct 01, 2018 Cystinosis Research Foundation Bearish

The patient foundation that funded early Procysbi research criticized post-acquisition pricing — the drug launched at ~$300K/yr in 2013 and reached >$1M/yr for…

Source summaries from our enrichment pipeline; follow links for originals.

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Horizon Pharma agreed to acquire Raptor Pharmaceutical for $9.00/share cash (~$800M equity, ~$860.8M total including debt repayment). Adds PROCYSBI (cysteamine for nephropathic cystinosis) and QUINSAIR (inhaled levofloxacin for CF, EU only) to Horizon's rare-disease portfolio. Closed October 25, 2016.

Did it work? Outcome assessment

One durable niche orphan drug (Procysbi) justified a fraction of the price; the rest of what was paid for (Quinsair, Raptor's pipeline) evaporated within a year or two of close.

Strategic verdict
Partially Achieved
Financial impact
Accretive
Procysbi grew to $170.1M net sales in FY2020 (vs. $161.9M FY2019) against an ~$800M purchase price; Horizon had guided the deal accretive to adjusted EBITDA in 2017. Quinsair EMEA rights were monetized for $70M upfront in 2017. No impairment related to the Raptor assets was identified in the period reviewed.
Pipeline outcome
Mixed
Procysbi (nephropathic cystinosis) was integrated into Horizon's orphan segment and grew steadily through 2021. Quinsair, the second Raptor asset, was not advanced by Horizon: EMEA rights were divested to Chiesi in May 2017 and no US approval was pursued to market.

Key facts

Disease & market context

Nephropathic Cystinosis

15 US cases/yr · $300M Procysbi peak sales projection (Zacks/analyst-cited)

Disease Overview

Nephropathic cystinosis is an ultra-rare autosomal recessive lysosomal storage disorder caused by CTNS gene mutations that prevent cystine export from lysosomes. Cystine crystals accumulate in kidneys (causing Fanconi syndrome and progressive renal failure), eyes, thyroid, muscle, and CNS, typically presenting in infancy. Cysteamine depletes lysosomal cystine and is the only disease-modifying therapy.

Competitive Landscape

The cystinosis therapeutic market at deal time was effectively a two-product duopoly within the same molecule class. Mylan's Cystagon (immediate-release cysteamine bitartrate, dosed every 6 hours including overnight) was the legacy generic standard but suffered from severe adherence problems due to its punishing dosing schedule and GI tolerability. Raptor's Procysbi (delayed-release cysteamine bitartrate, BID dosing) was approved by the FDA in April 2013 and EMA in 2013 — a reformulation rather than a novel mechanism, but one with patent protection through 2034 and clinical evidence of better compliance and cystine control. Quinsair (inhaled levofloxacin) added a CF lung-infection asset competing against Vertex-pivot drugs and inhaled tobramycin (TOBI/Bethkis) and aztreonam (Cayston, Gilead) in a market that was rapidly being remapped by Vertex's CFTR modulators (Kalydeco, Orkambi). The Horizon acquisition was less about competitive disruption and more about portfolio assembly — adding a high-priced orphan annuity (Procysbi at $300K-$1M+/yr) to a rare-disease platform that had been building through Hyperion (urea-cycle) and Crealta (Krystexxa). The transaction drew patient-advocacy criticism over Procysbi pricing escalation post-acquisition.

Related deals — scored

DealYearValueOutcome
Horizon Pharma plc / Raptor Pharmaceutical Corp. (this deal)2016$860M46
Horizon Pharma plc / Crealta Holdings LLC2015$510M87
Horizon Pharma plc / Hyperion Therapeutics, Inc.2015$1.1B79
Pfizer Inc. / BioNTech SE2020$748M100
Gilead Sciences Inc. / Pharmasset Inc.2011$11.2B98
Abbott Laboratories / Alere Inc.2016$5.8B95
bioMerieux SA / BioFire Diagnostics Inc.2013$485M88

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