Assertio Holdings, Inc., the successor issuer toAssertio Therapeutics, Inc. Therapeutics, Inc., (“Assertio” ) (NASDAQ: ASRT) announced the closing of the merger with Zyla Life Sciences. The combined company (the “Company”) will operate under the Assertio name and trade on Nasdaq under the ticker ASRT.
The merger creates a growing commercial pharmaceutical company with neurology, inflammation and pain products. The Company now has a differentiated portfolio of non-steroidal anti-inflammatory drugs (NSAIDs) commonly used by neurologists, orthopedic surgeons, internists, women’s health providers, podiatrists, pain care specialists and urologists. All eight products are branded, FDA-approved products and will be managed by the Company’s newly formed and highly experienced commercial team.
Anticipated Strategic and Financial Benefits of the Merger
- Pro forma 2019 net product sales of approximately $128 million1
- Projected pro forma 2020:
- Non-GAAP adjusted EBITDA margin of greater than 25 percent
- Upwards of $40 million in cost synergies expected, in addition to Assertio’s previously announced anticipated $15 million in cost synergies due to acceleration of cost savings initiatives
- Complementary products expected to result in leading portfolio of NSAIDs
- Positioned to take advantage of current trend toward non-opioid pain products
- Projected mid to high-single digit revenue growth for 2020
- Holding company is expected to have net debt to EBITDA leverage of two times
- Positions the Company to add differentiated products through acquisitions and partnerships
“With the completion of this merger, we are on track to be a leading specialty pharmaceutical company,” said Todd Smith, incoming president and CEO of Assertio. “I am excited to lead the talented team that has worked so hard to grow both businesses and remain dedicated to creating the new Assertio during this challenging time. Thank you to everyone who has seen this transaction through to close. This is just the beginning of an exciting growth opportunity for our employees, the patients we serve and the investors who support our path to value creation. We look forward to updating you on our progress and path forward on our second quarter earnings call.”
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With this merger closed, the Company has a board composed of nine directors. Six directors from the pre-merger Assertio board, including Arthur Higgins, the non-executive chairman, Heather L. Mason, William T. McKee, Peter D. Staple, James L. Tyree and David E. Wheadon. In addition, Todd N. Smith, Timothy P. Walbert, the lead independent director, and Andrea Heslin Smiley joined from the Zyla board.
Advisors
Stifel acted as the exclusive financial advisor to Assertio and Gibson, Dunn & Crutcher LLP acted as its legal counsel. MTS acted as the exclusive financial advisor to Zyla and Dechert LLP acted as its legal counsel.
Non-GAAP Information
This press release includes estimated non-GAAP adjusted EBITDA margin and non-GAAP net debt to EBITDA leverage, each, a non-GAAP financial measure. The Company believes these non-GAAP financial measures not only provide the Company’s management with comparable financial data for internal financial analysis but also provide meaningful supplemental information to investors. Specifically, these non-GAAP financial measures enable investors to better understand the anticipated performance of the business and facilitate a meaningful evaluation of the Company’s preliminary estimate for non-GAAP adjusted EBITDA margin and non-GAAP net debt to EBITDA leverage for 2020. These non-GAAP measures should be considered a supplement to, and not as a substitute for or superior to, financial measures calculated in accordance with GAAP. No reconciliation of estimated non-GAAP adjusted EBITDA margin or non-GAAP net debt to EBITDA leverage is provided in this press release because some of the excluded information is not yet ascertainable or accessible and the Company is unable to quantify certain amounts that would be required to be included in the most directly comparable GAAP financial measures without unreasonable efforts.
Source: Biospace