Pfizer plans to acquire NextWave Pharmaceuticals, a specialty drug company focused on attention-deficit hyperactivity disorder (ADHD) and other central nervous system disorders. NextWave’s Quillivant XR, an extended-release version of the generic ADHD drug methylphenidate, won FDA approval in September.
Pfizer put up $20 million earlier this year for an option to acquire NextWave, and it will pay $255 million more upon the close of the deal, which is expected by the end of the year. Additional milestone payments could bring the value of the acquisition to nearly $700 million.
The purchase illustrates a shift in strategy for a major drug company that in recent years has made multi-billion-dollar acquisitions of other big drugmakers. Pfizer historically eschewed generics. But after the loss of patent protection for its cholesterol drug Lipitor, the biggest-selling drug in history, and the downsizing of its in-house R&D organization, Pfizer is signaling an intention to increase its presence in generics.
The deal also marks Pfizer’s entry into the competitive ADHD market, with the first once-daily liquid formulation of methylphenidate. The drug was discovered by Ciba, now Novartis, in the 1940s and first marketed as Ritalin. “This agreement demonstrates our focused expansion of the established-products, U.S. brands business,” says Albert Bourla, president of Pfizer’s established-products unit.
Two patents on Quillivant XR’s extended-release technology are held by Tris Pharma, which developed the drug in partnership with NextWave. NextWave holds exclusive North American marketing rights to the drug.