MONTREAL – Drug company Paladin Labs Inc. has a strong balance sheet and is still looking for more acquisitions after dropping its hostile takeover attempt for the maker of the Cold-FX flu remedy, the company’s interim chief executive said Tuesday.
“We’ve got over $200 million in which to pursue product deals,” Paladin interim president and CEO Mark Beaudet said in an interview Tuesday.
“We do have opportunities we’re looking at internationally. We have opportunities we’re looking at domestically.”
Paladin’s decision Monday to end its bid for Afexa Life Sciences (TSX:FXA) clears the way for a friendly $88-million takeover of the Edmonton company by Valeant Pharmaceuticals International (TSX:VRX) of Mississauga, Ont.
Montreal-based Paladin (TSX:PLB) will pocket about $5 million from the Afexa deal because it owns about 15.4 million shares in the company, Beaudet said.
“It will just add to the base of assets that we can use to go out and acquire new products and new businesses.”
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Beaudet noted that Paladin’s friendly takeover offer for Quebec-based pharmaceutical company Labopharm (TSX:DDS) is expected to go through on Wednesday.
With Labopharm’s board of directors already giving thumbs up to the takeover, its shareholders are expected to approve the deal, which has been valued at just more than $20 million.
With acquisition of troubled Labopharm, Paladin will broaden its offerings for pain relief as well as its profits.
“We will be acquiring the worldwide rights to their key product Tramadol, which will add to our profitability and add to our revenue base internationally,” Beaudet said.
Tramadol is a once-daily narcotic treatment for those with moderate to moderately severe pain and is an alternative to codeine, he said.
Paladin has several pain relief drugs including Abstral, which manages pain for cancer patients, and Metadol for acute cancer pain. It’s expected to launch a new product in the second half of 2012 for those with grass allergies that will be taken orally, Beaudet said.
Beaudet said specialty pharmaceutical company Paladin is primarily known for its prescription drugs, but also has a rapidly growing portfolio of over-the-counter products to which Afexa’s Cold-FX would have been a “nice complement.”
Paladin has nine non-prescription medications including children’s fever reducer Tempra, teething product Anbesol, anti-diarrhoea relief Kaopectate, the sleep aid Unisom and the emergency contraceptive Plan B, but it doesn’t currently have any anti-cold remedies.
The Montreal-based company recently reported that its second-quarter profits more than tripled. Its income for the quarter of $16.8 million, or 80 cents per share, compared to $4.9 million or 25 cents per share in the same period a year earlier.
Revenues rose nine per cent to a record $36 million on growth in the sales of its current product portfolio.
Paladin’s CEO Jonathan Goodman was recently in a bicycle accident and is still recovering in hospital from a head injury, Beaudet said.
Shares in Paladin were down 59 cents to $36.01 in afternoon trading on the Toronto Stock Exchange.
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