Lantheus’s decision to acquire Progenics Pharmaceuticals is not necessarily a bad one: the all-stock deal, worth approximately $400m, allows Lantheus to diversify away from its core imaging tracer business. Lantheus is very reliant on Definity, the cardiovascular ultrasound contrast agent which makes up more than half its sales. It could therefore benefit from adding Progenics’ radiopharmaceuticals, including Azedra, approved last year for the rare cancers pheochromocytoma and paraganglioma, and the royalty stream from the constipation drug Relistor, licensed to Bausch Health Companies. But the acquisition is the largest in Lantheus’s history, prompting concerns about integration, and will change the buyer from a reliably profitable company to a loss-making one in the short term. This has prompted shareholders to desert, with Lantheus’s stock down 21% yesterday. After a couple of years of hardship the company insists it will be will be back in the black with the transaction adding to earnings by 2022. Perhaps this will lure new shareholders more willing to wait for returns – but Lantheus will have to do a decent job of execution.
|Lantheus and Progenics - how their sales compare|
|Annual WW sales ($m)|
|Company||Product||Product type||2018||2020||2022||2024||CAGR||WW phase|
|Thallium Tl 201||Radiodiagnostic||3||2||1||1||-15%||Marketed|
|Relistor (royalties)||Constipation drug||15||23||35||67||29%||Marketed|
|Total (incl. others)||16||62||143||221||55%|