Canada's Valeant Pharmaceuticals is paying $1 billion to buy Sprout Pharmaceuticals, which just won US government approval to sell the first "female Viagra" drug, the firms announced Thursday.
North Carolina-based Sprout received the nod Tuesday from the US Food and Drug Administration for flibanserin, to be marketed as Addyi in the United States, to treat a condition known as "acquired, generalised hypoactive sexual desire disorder (HSDD)," or sudden and severe loss of libido.
It was the first FDA-approved treatment for sexual desire disorders in men or women.
Under the terms of the acquisition agreement, Valeant will pay about $1 billion in cash for Sprout: $500 million upon the closing of the transaction, expected by end-September, and $500 million payable in the first quarter of 2016.
Montreal-based Valeant also will pay a share of future profits benchmarked to achievement of certain milestones.
Valeant expects Addyi to be available in the United States in the fourth quarter this year, and plans to bring the drug to the international market.
"Delivering a first-ever treatment for a commonly reported form of female sexual dysfunction gives us the perfect opportunity to establish a new portfolio of important medications that uniquely impact women," said J. Micheal Pearson, Valeant chairman and chief executive, in a statement.
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