Horizon (HZNP) Ups View on Crealta Holdings Deal, Shares Up
Horizon Pharma plc HZNP raised its 2016 net sales guidance on the back of the expected closure of the Crealta Holdings LLC acquisition later this week. Shares gained 6.2% on the news. In Dec 2015, Horizon Pharma entered into a definitive agreement to acquire Crealta Holdings LLC in a cash deal valued at $510 million.
The Crealta deal will add Krystexxa to Horizon Pharma’s orphan drug portfolio, which already includes drugs like Actimmune, Rybicki and Buphenyl. Krystexxa is the first and only FDA-approved medicine for chronic refractory gout.
Guidance
As a result of the Crealta deal, the company now expects net sales to be in the range of $1.025 to $1.050 billion, up from the previous guidance of $950 to $975 million. The guidance range falls above the Zacks Consensus Estimate of $988 million.
The company plans to leverage its rheumatology infrastructure by adding 41 people to the rheumatology specialty sales force currently promoting Rayos and Pennsaid 2% to the 24-person rheumatology account managers promoting Krystexxa.
Horizon Pharma has been focused on expanding its orphan drug business, as evidenced by its long-range plan, wherein the orphan business is expected to constitute approximately 60% of net sales in 2020. The company has been quite active on the acquisition front over the past few quarters. Last year, it acquired Hyperion Therapeutics in a deal valued at about $1.1 billion, which added a couple of urea-cycle disorder drugs to its portfolio, thereby strengthening its position in the orphan disease market.
Currently, Horizon Pharma sports a Zacks Rank #1 (Strong Buy). Other top-ranked stocks in the health care sector include Anika Therapeutics Inc. ANIK and Baxalta Incorporated BXLT, both sporting the same Zacks Rank as Horizon Pharma. Actelion Ltd. ALIOF, with a Zacks Rank #2 (Buy), is another well-placed stock in the same sector.
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