The Deal: The Alza Corp has announced that it has exercised its option to purchase the Crescendo Pharmaceuticals Corp. for $100 million in cash. Crescendo, a former unit of Alza, was used to finance research and development through outside investors.
Discussion: The Crescendo Pharmaceuticals Corp. is a development-stage firm that received $300 million from its parent to fund the research of certain drug candidates. Crescendo now pays ALZA from these funds to develop these products, many of which use ALZA's drug-delivery technologies. The firm is currently paying ALZA to develop a treatment for acute and chronic pain. ALZA is marketing three Crescendo-funded, FDA-approved drugs: Ditropan, a treatment for overactive bladder; Concerta, a hyperactivity treatment; and Viadur, a prostate cancer therapy.
The Alza Corp. designs controlled-dosage drug-delivery systems, which range from skin patches to low-current electric devices that administer drugs through the skin. Key drugs that use ALZA's technology include Procardia XL oral angina/hypertension treatment; No. 1 smoking cessation patch NicoDerm CQ; and over-the-counter allergy medication Sudafed 24. ALZA also develops drugs for its own account, including Ditropan XL for overactive bladder and cancer treatment Doxil.
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