Summary

Other Scenarios:

Buyer: Alexza Pharmaceuticals, Inc. (ALXA) Last Price: 6.66 Market Cap.: 207.50M
Target: DRAXIS Health Inc. (USA) (DRAX) Last Price: 4.80 Market Cap.: 201.90M

Lines of Business Summary:

Product Summary:

Overlap & Complementary Sectors

Sector Buyer Target # of Focused Companies
Healthcare 916
Biopharmaceuticals 373
Medical Devices   253
Outsourced Services 67

- Focused. Denotes that the company is considered focused in this area. In general, Focused Companies draw the majority of their earnings in the sector/product area specified.

- Sector Pure-Plays. Denotes that the company is focused in the selected sector and generates nearly all earnings in the sector/product area specified.

- Sector Participation. Denotes that the company develops products in this line of business.

Sample Products in Similar Lines of Business

Sample Products in Complementary Lines of Business
Buyer (Total: 7)
  • Staccato System
Target (Total: 14)
  • Draxis Pharma Inc.
Buyer
  • AZ-002 (Staccato Alprazolam)
  • AZ-007 (Staccato Zaleplon)
  • AZ-104 (Low-Dose Staccato Loxapine)
  • AZ-001 (Inhaled Staccato Prochlorperazine)
Target
  • DRAXIMAGE I-131 Sodium Iodide Capsules
  • DRAXIMAGE Iobenguane I-131 Injection/131 I-metaiodobenzylguanidine (I-131MIBG)
  • Technetium (Tc 99m) Generators
  • DRAXIMAGE Tc 99 MarcoAggregated Albumin Kit (MAA)

Business Relationship Summary:

Top Key Suppliers

Top Key Customers
Buyer (Total: 1)
  • Autoliv Inc. (ALV)
Target (Total: 4)
  • Genzyme Corporation (GENZ)
  • MDS Inc. (USA) (MDZ)
  • BTG plc (BTG:GB)
  • Chinoin Pharmaceutical Company
Buyer (Total: 0)

n/a
Target (Total: 8)
  • GlaxoSmithKline plc (ADR) (GSK)
  • Genzyme Corporation (GENZ)
  • Pfizer Inc. (PFE)
  • Johnson & Johnson (JNJ)

Key Financial Summary:

Key Metrics

  Buyer Target
Number of Employees 144 404
Revenue Per Employee 10,996.8 178,290.5
Total Revenue 0.0 20.5
Total Expenses 17.4 21.7
Other Revenue 0.0 0.0
Cost of Revenue 0.0 13.1
SG&A Expense 3.7 6.7
Research & Development 13.7 0.2
Other Operating Expense 0.0 0.0
Operating Income -17.4 -1.2
Unusual Income 0.0 0.0
LT Debt to Capital 7.67 0
Fwd P/E -5.03 27.11
Fwd P/Rev 37.41 2.20
Book Value 76.0 111.3
Curr Portion of LTD/Cap Lease 4.6 0.0

Individual Company Summary

Focused

Buyer

Focused (): Healthcare > Outsourced Services > Drug Delivery Technology > Pulmonary Delivery

Target

Focused (): Healthcare > Outsourced Services > Development/Manufacturing Services > Contract Manufacturing Organizations (CMO) > Pharmaceuticals > Final Dosage Forms

Business Description

Buyer

Alexza Pharmaceuticals, Inc. is a specialty pharmaceutical company focused on the development and commercialization of products for the treatment of acute and intermittent conditions. The Company has six product candidates in clinical development. Its technology, the Staccato system, vaporizes excipient-free drugs to form condensation aerosols that, when inhaled, allows for rapid systemic drug delivery. The Company is initially focusing on developing products by combining its Staccato system with small molecule drugs that have been in use for many years and are well characterized to create aerosolized forms of these drugs.

Target

DRAXIS Health Inc. (DRAXIS) is a specialty pharmaceutical company providing products in three categories: sterile products, non-sterile products and radiopharmaceuticals. Sterile products include liquid and freeze-dried (lyophilized) injectables and sterile ointments. Non-sterile products are produced as solid oral, liquid and semi-solid dosage forms. Radiopharmaceuticals are used for both therapeutic and diagnostic molecular imaging applications. As of January 1, 2005, all of the operations of the Company are carried out through its wholly owned subsidiary DRAXIS Specialty Pharmaceuticals Inc., which operates two divisions, DRAXIS Pharma (contract manufacturing) and DRAXIMAGE (radiopharmaceuticals). During the year ended December 31, 2006, 72.8% of its consolidated revenues were derived from DRAXIS Pharma (contract manufacturing) and 24.2% of its consolidated revenues were derived from DRAXIMAGE (radiopharmaceuticals).

Deal Summary

Key Ratios

  Buyer Target
Gross Margin % n/a 37.08
Operating Margin % n/a 2.72
Quick Ratio 7.47 3.37
Current Ratio 7.56 4.47
Coverage Ratio -0.09 0.41
Total Assets 149.1 127.9
Return on Equity % -73.57 1.49
Return on Assets % -37.49 1.3
Cash+ ST Inv. Per Share 3.5 0.59
Total Debt 10.9 0.0
Total Debt to Equity % 14.35 0
Total Debt to Tangible Equity % 14.35 0
Debt to Asset % 7.31 0.00

Product Summary

Sector Buyer Target
Healthcare
Biopharmaceuticals
Neurology
The Neurology Subsector includes therapeutics that treat disorders of the central nervous system, including the brain, spinal cord, and nerves.
Pain Management
The Pain Management Subsector includes therapeutics that treat and management pain.
  
Medical Devices  
Radiology
The Radiology Subsector includes medical devices that generate images of internal physiology.
  
Outsourced Services
Development/Manufacturing Services
The Development/Manufacturing Services Subsector includes companies that provide research, development, manufacturing, sales and marketing to biopharmaceutical and medical device companies.
  
Drug Delivery Technology
The Drug Delivery Technology Subsector includes companies that develop novel delivery methods for therapeutics.
  

- Focused. Denotes that the company is considered focused in this area. In general, Focused Companies draw the majority of their earnings in the sector/product area specified.

- Sector Pure-Plays. Denotes that the company is focused in the selected sector and generates nearly all earnings in the sector/product area specified.

- Sector Participation. Denotes that the company develops products in this line of business.

Product Details

Sector Buyer Target
Healthcare
Biopharmaceuticals
Neurology
Phase I/Phase II Clinical Stage Products
Therapeutics that are being investigated for the treatment of nervous system and mental disorders in early stages of clinical research where human subject is involved.

Buyer Products:

  • AZ-002 (Staccato Alprazolam)
  • AZ-007 (Staccato Zaleplon)
  • AZ-104 (Low-Dose Staccato Loxapine)
  • AZ-001 (Inhaled Staccato Prochlorperazine)

Target Products:

  • DRAXIMAGE I-131 Sodium Iodide Capsules
  • DRAXIMAGE Iobenguane I-131 Injection/131 I-metaiodobenzylguanidine (I-131MIBG)
Psychiatric Disorders  
Schizophrenia  
Dopamine Receptor Blocking Agents
Therapeutics that treat schizophrenia by blocking the dopamine receptors.

Buyer Products:

  • AZ-004 (Staccato Loxapine)
  
Pain Management  
Phase I/Phase II Clinical Stage Products
Therapeutics that are being investigated for the treatment of pain in early stages of clinical research where human subject is involved.

Buyer Products:

  • AZ-003 (Staccato Fentanyl)
  
Medical Devices  
Radiology  
Nuclear  
Gamma Camera  
Accessories  
Sources  
Standards
Guidelines for radioactive dosage calculations.

Target Products:

  • Technetium (Tc 99m) Generators
  
Contrast Agents  
Radionuclides  
Injectable
A liquid form of radionuclide contrast agent that is introduced into the body by way of a needle.

Target Products:

  • DRAXIMAGE Tc 99 MarcoAggregated Albumin Kit (MAA)
  • DRAXIMAGE Tc-99m Sestamibi
  • MDP
  • DTPA
  • DRAXIMAGE Tc 99 Diethylene-triamine Pentacetic Acid Kit
  • DRAXIMAGE Tc 99 Calcium Glucoheptonate Kit
  • DRAXIMAGE Somatoscan/Somatostatin Therapy
  • DRAXIMAGE INFECTON (Technetium-Labeled Ciprofloxacin)
  • DRAXIMAGE Tc 99 Methylene Diphosphonic Acid Kit
  
Oral
A pill form of radioactive contrast agent that is swallowed orally.

Target Products:

  • DRAXIMAGE I-131 Sodium Iodide Capsules
  • DRAXIMAGE Sodium Iodide I-131 Preparation Kit
  
Outsourced Services
Development/Manufacturing Services  
Contract Manufacturing Organizations (CMO)  
Pharmaceuticals  
Final Dosage Forms
Contract Manufacturing Organizations (CMO) that produce large quantities of drug products in final dosage forms ready to be sold to end users.

Target Products:

  • Draxis Pharma Inc.
  
Drug Delivery Technology  
Pulmonary Delivery  
Powder
Drug Delivery Technology used to deliver drugs in a powder of hollow, porous spheres containing drugs for deep lung delivery.

Buyer Products:

  • Staccato System
  

- Focused. Denotes that the company is considered focused in this area. In general, Focused Companies draw the majority of their earnings in the sector/product area specified.

- Sector Pure-Plays. Denotes that the company is focused in the selected sector and generates nearly all earnings in the sector/product area specified.

- Sector Participation. Denotes that the company develops products in this line of business.

Relationship Details

Key Competitors

  Name Dir Percent Market Cap. P/E Ratio (TTM) Fwd P/E P/R Ratio (TTM) Fwd P/Rev Price To Tang. Book Value
Buyer
  Nektar Therapeutics n/a 640.719 0.00 -7.07 2.35 7.07 4.81
Aradigm Corporation n/a 62.445 0.00 -2.20 64.97 15.65 2.06
YM BioSciences Inc. (USA) n/a 54.719 0.00 -1.90 7.18 n/a 1.02
BioDelivery Sciences International, Inc. n/a 43.652 0.00 n/a 216.13 n/a n/a
Target
  General Electric Company n/a 365,435.945 16.46 15.16 2.12 1.91 20.01
Johnson & Johnson n/a 181,615.215 17.17 14.59 2.97 2.87 12.48
Bristol Myers Squibb Co. n/a 42,514.526 19.64 12.60 2.20 1.97 10.04
Covidien Ltd. n/a 21,939.907 0.00 18.18 2.12 2.27 n/a
Cardinal Health, Inc. n/a 18,746.167 12.11 13.86 0.21 0.20 14.48
Biogen Idec Inc. n/a 18,082.394 28.38 19.28 5.70 5.05 9.49
Koninklijke DSM N.V. (ADR) n/a 8,077.809 13.16 10.43 0.62 n/a 1.29
Hospira, Inc. n/a 6,717.356 49.12 17.08 1.95 1.84 n/a
Patheon, Inc. n/a 280.060 0.00 n/a 0.41 n/a 1.77
Immunomedics, Inc. n/a 214.055 0.00 -10.14 60.14 n/a 16.30
Molecular Insight Pharmaceuticals, Inc. n/a 171.553 0.00 -2.75 246.10 268.44 5.80
Cytogen Corporation n/a 20.453 0.00 n/a 1.01 n/a 1.89
Boehringer Ingelheim GmbH n/a n/a n/a n/a n/a n/a n/a
Bayer Schering Pharma AG n/a n/a n/a n/a n/a n/a n/a
HAUPT Pharma AG n/a n/a n/a n/a n/a n/a n/a
MDS Nordion S.A. n/a n/a n/a n/a n/a n/a n/a
DPT Laboratories, Ltd. n/a n/a n/a n/a n/a n/a n/a
Bracco S.p.A. n/a n/a n/a n/a n/a n/a n/a
Hollister-Stier Laboratories LLC n/a n/a n/a n/a n/a n/a n/a

- Defined by the Company - Defined by Others

Dependent Suppliers

  Name Dir Percent Market Cap. P/E Ratio (TTM) Fwd P/E P/R Ratio (TTM) Fwd P/Rev Price To Tang. Book Value
Buyer
  Autoliv Inc. n/a 3,645.154 12.66 10.77 0.54 0.52 6.18
Target
  Genzyme Corporation n/a 19,547.587 40.71 21.15 5.13 4.30 5.35
MDS Inc. (USA) n/a 2,354.191 3.04 43.73 1.86 1.85 4.61
BTG plc n/a n/a n/a n/a n/a n/a n/a
Chinoin Pharmaceutical Company n/a n/a n/a n/a n/a n/a n/a

- Defined by the Company - Defined by Others

Key Customers

  Name Dir Percent Market Cap. P/E Ratio (TTM) Fwd P/E P/R Ratio (TTM) Fwd P/Rev Price To Tang. Book Value
Target
  GlaxoSmithKline plc (ADR) 23.00% 114,579.522 10.94 10.92 2.51 2.54 15.10
Genzyme Corporation 23.00% 19,547.587 40.71 21.15 5.13 4.30 5.35
Pfizer Inc. 13.00% 138,655.187 17.03 8.68 2.86 2.88 5.99
Johnson & Johnson 10.00% 181,615.215 17.17 14.59 2.97 2.87 12.48
General Electric Company n/a 365,435.945 16.46 15.16 2.12 1.91 20.01
Penwest Pharmaceuticals n/a 79.053 0.00 -2.70 23.90 8.68 5.77
DUSA Pharmaceuticals, Inc. n/a 61.160 0.00 -15.31 2.21 1.62 2.77
Bracco S.p.A. n/a n/a n/a n/a n/a n/a n/a

- Defined by the Company - Defined by Others

Key Partners

  Name Dir Percent Market Cap. P/E Ratio (TTM) Fwd P/E P/R Ratio (TTM) Fwd P/Rev Price To Tang. Book Value
Buyer
  Autoliv Inc. n/a 3,645.154 12.66 10.77 0.54 0.52 6.18
Endo Pharmaceuticals n/a 3,179.237 13.98 11.71 2.93 2.52 3.06
Symphony Holdings Limited n/a n/a n/a n/a n/a n/a n/a
Target
  General Electric Company n/a 365,435.945 16.46 15.16 2.12 1.91 20.01
Johnson & Johnson n/a 181,615.215 17.17 14.59 2.97 2.87 12.48
GlaxoSmithKline plc (ADR) n/a 114,579.522 10.94 10.92 2.51 2.54 15.10
Bristol Myers Squibb Co. n/a 42,514.526 19.64 12.60 2.20 1.97 10.04
Covidien Ltd. n/a 21,939.907 0.00 18.18 2.12 2.27 n/a
Genzyme Corporation n/a 19,547.587 40.71 21.15 5.13 4.30 5.35
Cardinal Health, Inc. n/a 18,746.167 12.11 13.86 0.21 0.20 14.48
MDS Inc. (USA) n/a 2,354.191 3.04 43.73 1.86 1.85 4.61
Penwest Pharmaceuticals n/a 79.053 0.00 -2.70 23.90 8.68 5.77
DUSA Pharmaceuticals, Inc. n/a 61.160 0.00 -15.31 2.21 1.62 2.77
BTG plc n/a n/a n/a n/a n/a n/a n/a
Isogenic Science, Ltd. n/a n/a n/a n/a n/a n/a n/a
Bracco S.p.A. n/a n/a n/a n/a n/a n/a n/a
Med Discovery SA n/a n/a n/a n/a n/a n/a n/a
Chinoin Pharmaceutical Company n/a n/a n/a n/a n/a n/a n/a
United Pharmacy Partners Inc. n/a n/a n/a n/a n/a n/a n/a

- Defined by the Company - Defined by Others

Financials

  Buyer Target Combined Entity
Income Statement
Operating Items
Revenue 0.0 78.9 78.9
Other Revenue 0.0 0.0 0.0
Total Revenue 0.0 78.9 78.9
Cost of Revenue 0.0 49.6 49.6
SG&A Expense 14.9 18.8 33.7
Depreciation & Amortization 0.0 5.8 5.8
Research & Development 45.6 2.4 48.1
Interest Expense 0.0 0.0 0.0
Other Operating Expense 0.0 0.0 0.0
Total Expenses 60.5 76.7 137.2
Operating Income -60.5 2.1 -58.4
Non Operating Items
Interest Expense (Inc.), Net Non-Oprtng 5.6 0.9 6.5
Other, Net 0.0 0.0 0.0
Income Before Taxes -55.9 1.3 -54.6
Income Taxes 0.0 -0.4 -0.4
Income After Taxes -55.9 1.7 -54.3
Minority Interest (IS) 10.8 0.0 10.8
Net Income - Excl. Xord. Items -45.1 1.7 -43.5
Net Income - Incl. Xord. Items -45.1 1.7 -43.5
Income Avail. to Common -45.1 1.7 -43.5
Share Items
Basic Avg. Shares Outstanding 31.1 42.0 73.1
Basic EPS - Excl. Xord. Items n/a 0.04 -0.59
Basic EPS - Incl. Xord. Items n/a 0.04 -0.59
Full Dilution Adjustment 0.0 0.0 0.0
Fully Diluted Shares Outstanding 31.1 42.0 73.1
F.D. EPS - Excl. Xord. Items n/a 0.04 -0.59
F.D. EPS - Incl. Xord. Items n/a 0.04 -0.59
Balance Sheet
Assets
Cash and Equivalents 31.3 24.8 56.1
ST Investments 77.5 0.0 77.5
Accounts Receivable 12.1 18.1 30.1
Inventory 0.0 9.6 9.6
Prepayments and Advances 1.4 1.4 2.7
Other Current Assets 0.0 2.9 2.9
Current Assets 122.3 56.8 179.0
Accum D&A 0.0 0.0 0.0
PPE, Net 26.2 58.5 84.6
Goodwill & Intangibles 0.0 1.1 1.1
Note Receivable 0.0 2.5 2.5
Other Assets 0.0 0.0 0.0
Other LT Assets 0.7 9.0 9.7
Total Assets 149.1 127.9 277.1
Liabilities
Accounts Payable 5.2 0.0 5.2
Payable/Accrued 0.0 11.9 11.9
Accrued Expenses 6.4 0.0 6.4
ST Debt 0.0 0.0 0.0
Curr Port of LTD & Cap Lease Oblg 4.6 0.0 4.6
Other (Current) Liabilities 0.0 0.8 0.8
Current Liab. 16.2 12.7 28.9
LT Debt 0.0 0.0 0.0
Capitalized Lease Obligations 6.3 0.0 6.3
Total LT Debt 6.3 0.0 6.3
Minority Interest (BS) 24.0 0.0 24.0
Other LT Liab. 26.7 3.9 30.6
Total Liabilities 73.1 16.6 89.7
Shareholders Equity
Common Stock 0.0 79.8 79.8
Additional Paid in Capital 240.7 16.0 256.7
Retained Earnings -164.1 -6.6 -170.7
Other Equity -0.6 22.1 21.5
Total Equity 76.0 111.3 187.3
Total Liab. & Equity 149.1 127.9 277.1
Shares Outstanding 31.1 42.1 73.2
Cash Flow
Operating Cash Flow
CF Net Income -45.1 1.7 -43.5
CF Depreciation 4.0 5.8 9.9
CF Deferred Taxes 0.0 -1.3 -1.3
Other Non-Cash Items -8.3 2.7 -5.6
Change in Working Capital 13.5 3.7 17.2
Total Cash From Operating Activities -35.8 12.6 -23.3
Investing Cash Flow (not calculated)
Capital Expenditures -19.1 -10.3 -29.4
Other Investing Cash Flows -0.9 -3.1 -4.0
Total Cash From Investing Activities -20.0 -13.4 -33.3
Financing Cash Flow (not calculated)
Dividends Paid 0.0 0.0 0.0
Purchase Or Sale of Stock 67.8 2.1 69.9
Purchase and Retirement of Debt 2.3 0.0 2.3
Other Financing Cash Flow 0.0 0.8 0.8
Total Cash From Financing Activities 70.1 2.9 73.0
Exchange Rate Effects 0.0 1.3 1.3
Net Change in Cash 14.3 3.3 17.7
Cash Taxes Paid 0.0 0.8 0.8
Cash Interest Paid 1.0 0.0 1.0