Sinclair IS Pharma said it had secured a long term distribution agreement for three dermatology products.
The 100 year deal with Valeant Pharmaceuticals will the see Sinclair making an upfront payment of €9.0m for the rights.
The company will make additional sales-based payments over the life of the distribution agreement.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Sinclair will be responsible for sales, marketing and distribution of the products in Western Europe with distribution expected to begin at the beginning of December 2012.
Chief Executive Chris Spooner said the deal extended Sinclair's dermatology portfolio and enabled it to further leverage the firm's existing sales and marketing infrastructure in the region.
The products together generated revenues of €9.1m (around £7.3m) in the year ended December 31st 2011.
Annualised EBITDA contribution after investment in selling and promotional costs is expected to exceed £2m.
The transaction will be funded through a placing to raise £9m through the issue of 32,142,858 new ordinary shares of 1p each in the Company at 28p per share.
This price marks a 4% premium to the closing price on September 28th.
The proceeds of the placing will be used to fund the up-front payment, as well as working capital and transaction costs, the firm said.
Analysts at Brewin Dolphin said the company's strategic aspiration to build a significant specialty pharmaceutical business had taken a further positive step.
"The move further strengthens Sinclair's aesthetic dermatology franchise," they said.
-
What happens if you can’t pay your tax bill, and what is "Time to Pay"?Millions are due to file their tax return this Friday as the self-assessment deadline closes. Though the nightmare is not over until you pay the taxman what you owe - or face a penalty. But what happens if you can't afford to pay HMRC your tax bill, and what is "Time to Pay"?
-
What does Rachel Reeves’s plan for growth mean for UK investors?Rachel Reeves says she is going “further and faster” to kickstart the UK economy, but investors are unlikely to be persuaded
