Medicines Co. To Sell Its Hemostatis Portfolio To Mallinckrodt - Quick Facts

(RTTNews) - Medicines Co. (MDCO) said that certain subsidiaries of pharmaceutical company Mallinckrodt plc (MNK) will acquire its global portfolio of three hemostasis products - Recothrom Thrombin topical, PreveLeak, and Raplixa or fibrin sealant - for a total potential consideration of up to $410 million.

Medicines Co. will receive an initial payment of about $175 million, including inventory, at closing and has the potential to receive up to $235 million in additional consideration for future milestone payments. The transaction is expected to close in the first calendar quarter of 2016.

In a separate statement, Mallinckrodt said that the addition of global hemostasis assets will augment its growing hospital portfolio, including INOmax and THERAKOS; specifically expanding on the current OFIRMEV surgical pain management offering.

Mallinckrodt said it expects the transaction to be dilutive to its fiscal 2016 earnings per share. However, on an adjusted basis, the company expects the transaction to be neutral to earnings per share in fiscal 2016.

On both reported and adjusted basis, the company expects the transaction to be accretive to earnings per share beginning in fiscal 2017.

Assuming a closing in the second quarter of fiscal 2016, the company expects the new products will add between $40 million and $45 million in incremental revenue in fiscal 2016, and provide low double-digit organic growth starting in fiscal 2017.

Mallinckrodt will report net sales from the new products in its Specialty Brands segment.