logo
Sign in or Register

Already a member?

Sign in

Or sign in with your account on:

Not a member yet?

Register
    

Retrophin Raises Offer to Acquire Transcept Pharmaceuticals to $4 Per Share

By  +Follow September 19, 2013 8:51AM
Share:
Tickers Mentioned:

Retrophin, Inc. (RTRX) is not giving up on its pursuit to acquire the shares of specialty drug maker Transcept Pharmaceuticals, Inc. (TSPT) that it does not already own.  Last week, Retrophin delivered a letter to the board of directors of Transcept offering to buy the remaining shares for $3.50 each in cash.  The offer was rejected. 

To defend itself from a hostile takeover, Transcept has adopted a shareholder rights plan, often called a “poison pill,” which keeps a shareholder from acquiring more than 4.99 percent of the company.

On Wednesday, Retrophin bumped the offer up to $4.00 per share, with Retrophin chief executive Martin Shkreli sending a letter to the board members of Transcept.

Transcept is focused on development of neuroscience drugs with its only FDA approval being the oral sleep aid Intermezzo (zolpidem tartrate).  Purdue Pharma holds commercialization and development right for Intermezzo in the U.S.  Royalty revenue for Transcept from Intermezzo in the first six months of 2013 was $1.0 million, up from $500,000 in the year prior period. 

Net loss for the six months ended June 30, 2013 was approximately $17.2 million, or $0.92 per share, versus a net loss of approximately $10.3 million, or $0.67 per share, for the six months of 2012.

Retrophin has four drugs in its pipeline with RE-021 the only one in the clinical stage, being researched in a mid-stage trial for Focal Segmental Glomerulosclerosis, a disease that can cause nephrotic syndrome in children and kidney failure in adults.  The company’s other compounds are targeting hard-to-treat diseases like Pantothenate Kinase-Associated Neurodegeneration (PKAN) and Duchenne Muscular Dystrophy.

In recent weeks, three major shareholders of Transcept have publicly stated their disapproval of Transcept’s current strategy.  Activist investor Peter Collery of SC Fundamental LLC, which owns a 6.7-percent stake in Transcept, sent a letter to Transcept chief executive, president and director Glenn Oclassen (read the SEC filing) saying that the company needs to use $60 million of its cash to conduct a share repurchase to build value, not pursue “simply wrongheaded,” (but unnamed) projects.

Collery didn’t hold back much in expressing his feelings toward Transept management.  Such as:

“I should note how troubled we are by your presumption that the company’s money is yours to do with as you see fit. You and your fellow directors have a fiduciary duty to company shareholders.”

And...

“I’d like, in closing, also to express my displeasure with the company’s recent grant of nearly 600,000 management stock options with a strike price of $2.93 per share. As described above, the company’s shares may have a current realizable value of $5 or so. Were Transcept to implement a buyback program, that value might rise to $6. Essentially no management skill would be required to realize these values. That the shares trade for less than $3 is a function of shareholders’ distrust of management. It is incredible that management should be granted undervalued stock options as a “reward” for having created that distrust and I would expect that an inquiry into the deliberations surrounding this recent option grant, and particularly, the suitability of the strike price would be quite interesting.”

Roumell Asset Management, LLC, the largest Transcept shareholder at 12.3 percent of the company, has also filed a 13D with the SEC criticizing the management and demanding a share buy-back plan, not an unidentified acquisition.

The new proposal by Retrophin offers to buy Transcept at a 20-percent premium to Tuesday’s closing price.  The price is still lower than the $6 mark that Collery believes can be attained by performing a share repurchase, but this is a little to-may-toes/to-ma-toes because a merged company could benefit similarly, so investors will have to see where the support falls with the new proposal.

“Our proposal represents an attractive premium to Transcept’s trading performance, and we believe that the proposal offers a compelling opportunity for Transcept’s stockholders, particularly in light of Transcept’s risky and controversial acquisition strategy,” stated Martin Shkreli, Chief Executive Officer of Retrophin. “We hope that Transcept’s Board of Directors will respect its stockholders’ wishes and quickly commence discussions with us regarding the proposed transaction.”

Retrophin wants a transaction to be entered into by the end of September.

Shares of TSPT are down about 18 percent in 2013 thanks to a run-up from lows of $2.52 late in August with the acquisition chatter.  At lows, the stock was off about 40 percent.  Shares rose by 8 percent in Wednesday trading to close at $3.59.  In extended trading, shares rose to $3.98.  Retrophin shares edged up about 1 percent on the day to $6.88.  Shares have more than doubled in 2013.

Results for rtrx
King of All Stocks
16 Apr 14 13:15:05
$RTRX RETROPHIN, INC. Files SEC form 8-K, Other Events, Financial St http://t.co/WvE3tvwCwj
Cammie Filman
16 Apr 14 12:59:18
$RTRX RETROPHIN, INC. Files SEC form 8-K, Other Events, Financial Statem http://t.co/fMchLIq3Zn
Bertie Beyer
16 Apr 14 12:28:09
$RTRX RETROPHIN, INC. Files SEC form 8-K, Other Events, Financial St http://t.co/so1lCqOjt0
Nico Salvatore Enea
16 Apr 14 11:52:47
just bought very small amount of $RTRX calls. just tryin it out -- i agree that 103.00 IV is way too cheap for this stock
Edmund Sullivan
16 Apr 14 11:05:32
@chasingthealpha $RTRX IV cheaper than $SRPT
Bio Penny Picks
16 Apr 14 11:05:08
RT @chasingthealpha: Seems $RTRX options listed
Stock Market News
16 Apr 14 09:59:17
$RTRX RETROPHIN, INC. Files SEC form 8-K, Other Events, Financial Statem http://t.co/Vk8WIbWvSX
Ben Sirmons
16 Apr 14 09:45:41
Out of $RTRX, it's looking too sick
Stock Pilot
16 Apr 14 09:21:55
$RTRX RETROPHIN, INC. Files SEC form 8-K, Other Events, Financial Statements a http://t.co/UAao3EUhaq
Michael Torres
16 Apr 14 09:15:48
@vendbienjon I've been soured enough against $RTRX that it will take a lot for me to trade it on the long side again.
Jon Vince
16 Apr 14 09:10:34
"@chasingthealpha: Seems $RTRX options listed" @Mykalt45
Scott Thomas
16 Apr 14 09:06:48
RT @chasingthealpha: Seems $RTRX options listed
TurboResearch
16 Apr 14 09:04:26
RT @chasingthealpha: Seems $RTRX options listed
Patrick Crutcher
16 Apr 14 09:02:39
Seems $RTRX options listed
Johann Garcia
16 Apr 14 08:50:18
$RTRX RETROPHIN, INC. Files SEC form 8-K, Other Events, Financial Statem http://t.co/5FFrEmqAVq
Alex Seizew
16 Apr 14 08:06:58
Sold 1000 $RTRX @ 12.00
Jake Schaible
16 Apr 14 07:52:31
Noting $RTRX completed a classic gap fill y'day. Would seem to be posting a bullish harami today.
Linlin Mendoza
16 Apr 14 07:49:39
I would consider buying $rtrx below $5. But, only because the bio-illuninati love lies and the lying wunderkind liars who tell them
Michael Fuller
16 Apr 14 07:16:00
@maniac8480 and yet no volume, so you didn't buy any? They are cheap, buy buy buy $RTRX
Edmund Sullivan
16 Apr 14 07:00:19
$RTRX May 12.5 calls 92 IV - cheap for a stock that just got cut in half in 2 weeks IMO
Deon Carter
16 Apr 14 06:52:23
$RTRX RETROPHIN, INC. Files SEC form 8-K, Other Events, Financial Statem http://t.co/3l9XnQmyp6
Lutz Braune
16 Apr 14 03:17:05
$RTRX Seward & Kissel LLP | Business Transactions Group 2013 Year in Review http://t.co/TgZoeAq8e9
Investment Mogul
16 Apr 14 02:57:30
$RTRX RETROPHIN, INC. Files SEC form 8-K, Other Events, Financial Statements a http://t.co/17WzWxl5rj
Sharice Keegan
16 Apr 14 01:53:22
$RTRX RETROPHIN, INC. Files SEC form 8-K, Other Events, Financial Statem http://t.co/RkRJNUIEI1
Extreme Biotech
15 Apr 14 22:49:40
@danwessler Remember $RTRX was drifting in the $5 - $6 range for most of last year. Started to move in Jan 2014. Lots of gap filling to go
masterlongevity
15 Apr 14 20:11:55
RT @bradloncar: Why I sold some $RTRX yesterday (and why I still own some): http://t.co/9XDfznULvU
Ambrose Babcock
15 Apr 14 18:33:30
$RTRX RETROPHIN, INC. Files SEC form 8-K, Other Events, Financial Statem http://t.co/HGCaHZ93rh
Phil Goedeker
15 Apr 14 18:26:53
$RTRX absolutely destroyed the last week
Pass the Puck
15 Apr 14 17:24:05
Deanna McKinniss joins Rob Scott Bell to discuss using #CBD for her Grandson Zachary who suffers from NBIA. https://t.co/GmRbd5gb6w $RTRX
Crew Dailyoxj
15 Apr 14 17:12:42
$RTRX RETROPHIN, INC. Files SEC form 8-K, Other Events, Financial St http://t.co/J8yqlnrhU8
Alex Seizew
15 Apr 14 16:57:46
@bradloncar @VikramKhanna_ $RTRX Ralph Kiner (RIP) quote; "Home run hitters drive Cadillacs, single hitters drive Fords."
Dan Wessler
15 Apr 14 16:36:25
$RTRX - Gap filled! Is this the bottom? #notlikely #ceostillawesome
ChimeraResearchGroup
15 Apr 14 16:30:37
April 14 Biotech Update- $IBB $RTRX http://t.co/T84PGc8sxE
Luther Cox
15 Apr 14 15:54:40
$RTRX RETROPHIN, INC. Files SEC form 8-K, Other Events, Financial Statem http://t.co/IzCYWHiBEj
Rio Kinlan
15 Apr 14 15:37:45
$RTRX RETROPHIN, INC. Files SEC form 8-K, Other Events, Financial Statem http://t.co/fQdGhbAWWx
Spartan Biotech
15 Apr 14 14:28:33
Ouch “@adamfeuerstein: $RTRX FDA won’t allow RE-024 (PKAN drug) to start human clinical trial. Delayed.”
Extreme Biotech
15 Apr 14 14:26:49
RT @TurboResearch: $RTRX Catching up on all the controversies, company shorting stocks like $PRAN etc,sounds more like a hedge fund than a …
Extreme Biotech
15 Apr 14 14:26:16
RT @adamfeuerstein: $RTRX FDA won’t allow RE-024 (PKAN drug) to start human clinical trial. Delayed.
M
15 Apr 14 13:42:57
@bryan4665 @MKerryFuller $rtrx, at least get the guys age right. He's 31. I'd bet your virginity# correlates well w/ your follower# vs. his
Bryan Campbell
15 Apr 14 13:30:57
@MKerryFuller $rtrx = Shrek = 32 year old virgin = scammer....all same guy
Michael Fuller
15 Apr 14 13:00:45
Darn thing is still going down, who'd a thunk? $RTRX
Alex Seizew
15 Apr 14 12:54:30
$RTRX bought 1000 shares @ 11.64
biotechtoreador
15 Apr 14 12:06:01
RT @maniac8480: @bsirmons $RTRX Picking bottoms can be messy, but this looks like a fine bottom to pick." LOL!!!!!
Edmund Sullivan
15 Apr 14 11:32:58
$RTRX - options listing tomorrow
M
15 Apr 14 11:32:42
$RTRX Options tomorrow?
M
15 Apr 14 11:28:51
@bsirmons $RTRX Picking bottoms can be messy, but this looks like a fine bottom to pick.
Pawcio
15 Apr 14 11:10:31
Added $rtrx $orex here for better or worse, likely worse
Ben Sirmons
15 Apr 14 11:05:58
$RTRX bottom?
Bryan Campbell
15 Apr 14 10:36:01
@MKerryFuller @ColfaxCapital @michaeljnatale not working today $rtrx down another 12%
Michele Ciani
15 Apr 14 10:24:21
RT @BioRunUp: Notable ugliness: $TGTX -14%, $IDRA -15%, $MSTX -14%, $CYTK -11%, $SGYP -10%, $RTRX -11%, $PGNX -8.5%, $SYN - 9%
				
				
By  +Follow September 19, 2013 8:51AM
Share:

Comments

 

blog comments powered by Disqus

About us

Equities.com is the most advanced interactive online social ecosystem for the financial industry, serving as a resource center and next-generation communication platform that connects self-directed investors with public issuers, market experts, and professional service providers and vendors. Registered members can leverage our exclusive proprietary research tools such as the Small-Cap Stars, which outperformed 90% of all small-cap mutual funds, and robust do-it-yourself E.V.A. research reports. The Equities.com Issuer Dashboard is the ideal tool to communicate and manage investor awareness campaigns to the investment community, as well as to access valuable resources to help your company grow.

Market Data powered by QuoteMedia.
Copyright © QuoteMedia. Data delayed 15 minutes unless otherwise indicated. Terms of Use.