Summary

Other Scenarios:

Buyer: Celera Group, Applera Corp. (CRA) Last Price: 15.60 Market Cap.: 1.24B
Target: Penwest Pharmaceuticals (PPCO) Last Price: 8.55 Market Cap.: 200.03M

Lines of Business Summary:

Product Summary:

Overlap & Complementary Sectors

Sector Buyer Target # of Focused Companies
Healthcare 931
Biopharmaceuticals 377
Medical Devices   255
Outsourced Services 69
Scientific Products   36

- 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: 16)
  • Celera Genomics Contract Manufacturing
  • Celera Discovery System
Target (Total: 12)
  • SyncroDose
  • Geminex
  • TIMERx
  • Gastroretentive Drug Delivery System
Buyer
  • Cathepsin K Inhibitor
  • Antibody Target Program
  • Abbott Laboratories Neisseria gonorrhea Test
  • Abbott Laboratories HCV Assay
Target
  • Nifedipine XL
  • PW2132 (Torsemide ER)
  • PW4110
  • PW4153

Business Relationship Summary:

Top Key Suppliers

Top Key Customers
Buyer (Total: 0)

n/a
Target (Total: 2)
  • Mylan Inc. (MYL)
  • DRAXIS Health Inc. (USA) (DRAX)
Buyer (Total: 8)
  • Merck & Co., Inc. (MRK)
  • Bayer AG (ADR) (BAYRY)
  • Quest Diagnostics Incorporated (DGX)
  • Laboratory Corp. of America Holdings (LH)
Target (Total: 4)
  • Mylan Inc. (MYL)
  • sanofi-aventis (ADR) (SNY)
  • Endo Pharmaceuticals (ENDP)
  • Merck KGaA

Key Financial Summary:

Key Metrics

  Buyer Target
Number of Employees 290 75
Revenue Per Employee 140,564.4 35,697.8
Total Revenue 10.2 0.7
Total Expenses 29.8 9.9
Other Revenue 0.0 0.0
Cost of Revenue 3.9 0.1
SG&A Expense 8.0 3.7
Research & Development 13.5 6.0
Other Operating Expense 0.0 0.0
Operating Income -19.6 -9.1
Unusual Income 4.3 0.0
LT Debt to Capital 0 25.18
Fwd P/E -220.71 -5.18
Fwd P/Rev 19.97 64.18
Book Value 725.9 32.1
Curr Portion of LTD/Cap Lease 0.0 1.2

Individual Company Summary

Focused

Buyer

Focused (): Healthcare > Outsourced Services > Drug Discovery Services > Target Discovery/Validation

Target

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

Business Description

Buyer

Celera Group, Applera Corp., formerly Celera Genomics Group, conducts business through two business segments. The Company?s Applied Biosystems Group (Applied Biosystems) serves the life science industry and research community by developing and marketing instrument-based systems, consumables, software, and services. Its customers use these tools to analyze nucleic acids, small molecules and proteins to make scientific discoveries and develop new pharmaceuticals. Applied Biosystems? products also serve the needs of some markets outside of life science research, which it refers to as applied markets, such as the fields of human identity testing (forensic and paternity testing). Its Celera Group (Celera) is primarily a molecular diagnostics business that is using genomics and proteomics discovery platforms to identify and validate diagnostic markers. In July 2006, Applied Biosystems completed the acquisition of Agencourt Personal Genomics, Inc.

Target

Penwest Pharmaceuticals Co. (Penwest) develops pharmaceutical products based on drug delivery technologies with a focus on products that address disorders of the nervous system. In June 2006, the United States Food and Drug Administration (FDA), approved for marketing Opana ER, an extended release formulation of oxymorphone hydrochloride that the Company developed with Endo Pharmaceuticals Inc (Endo), using its TIMERx drug delivery technology. Penwest is also developing product candidates designed for the treatment of pain, epilepsy, Parkinson?s disease and spasticity, as well as a product candidate for the treatment of edema resulting from congestive heart failure. The Company conducts its business primarily in North America.

Deal Summary

Key Ratios

  Buyer Target
Gross Margin % 59.51 85.73
Operating Margin % -146.46 -1,171.13
Quick Ratio 15.01 6.99
Current Ratio 16.05 7.23
Coverage Ratio -0.44 -0.05
Total Assets 768.7 51.4
Return on Equity % -2.72 -104.45
Return on Assets % -2.57 -65.22
Cash+ ST Inv. Per Share 7.13 1.62
Total Debt 0.0 12.0
Total Debt to Equity % 0 37.41
Total Debt to Tangible Equity % 0 41.44
Debt to Asset % 0.00 23.36

Product Summary

Sector Buyer Target
Healthcare
Biopharmaceuticals
Cardiovascular System
The Cardiovascular System Subsector includes therapeutics that treat disorders affecting the heart and blood vessels.
  
Musculoskeletal System
The Musculoskeletal System Subsector includes therapeutics that treat disorders of the bones, joints, ligaments, tendons, and soft tissue involved with them.
  
Neurology
The Neurology Subsector includes therapeutics that treat disorders of the central nervous system, including the brain, spinal cord, and nerves.
  
Oncology
The Oncology Subsector includes therapeutics that treat and manage various types of cancer and related complications.
  
Pain Management
The Pain Management Subsector includes therapeutics that treat and management pain.
  
Medical Devices  
Clinical Diagnostics
The Clinical Diagnostics Subsector includes medical devices that analyze human body specimens within a medical setting. These devices, including equipment, biological and chemical reagents are primarily used for the diagnosis of diseases.
  
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.
  
Drug Discovery Services
The Drug Discovery Services Subsector includes companies that provide biopharmaceutical companies with novel biological targets and drug leads.
  
Scientific Products  
Consumables
The Consumables Subsector includes chemicals, reagents, standards, media, and disposable labware that are normally depleted or worn out by continuous use.
  

- 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
Cardiovascular System  
Heart Disorders  
Angina  
Calcium Channel Blocking Agents
Therapeutics that treat chest pains by preventing the entry of calcium into heart muscle cells.

Target Products:

  • Nifedipine XL
  
Phase I/Phase II Clinical Stage Products
Therapeutics that are being investigated for the treatment of heart and circulatory system disorders in early stages of clinical research where human subject is involved.

Target Products:

  • PW2132 (Torsemide ER)
  
Vascular Disorders  
Hypertension  
Calcium Channel Blocking Agents
Therapeutics that treat high blood pressure by blocking the beta adrenergic receptors of the heart muscle and increasing the excretion of sodium ions, potassium ions, and water through urine.

Target Products:

  • Nifedipine XL
  
Musculoskeletal System  
Phase I/Phase II Clinical Stage Products
Therapeutics that are being investigated for the treatment of skeletal system disorders in early stages of clinical research where human subject is involved.

Buyer Products:

  • Cathepsin K Inhibitor
  
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.

Target Products:

  • PW4110
  
Research/Preclinical Stage Products
Therapeutics that are being investigated for the treatment of nervous system and mental disorders in very early stages of research where no human subject is involved.

Target Products:

  • PW4153
  • PW4159
  • PW4158
  
Oncology  
Research/Preclinical Stage Products
Therapeutics that are being investigated for the treatment and management of cancer and are currently in an early research or preclinical stage of development.

Buyer Products:

  • Antibody Target Program
  
Pain Management  
Narcotics  
Opioids
Therapeutics that treat pain by binding to certain nervous system receptors which alter both the perception of pain as well as the emotional response to pain.

Target Products:

  • Opana ER (Oxymorphone Hydrochloride Extended Release)
  
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.

Target Products:

  • PW4142 (Nalbuphine ER)
  
Medical Devices  
Clinical Diagnostics  
Immunoassays  
Reagents  
Test Kits  
Bacterial  
Neisseria gonorrhea
Immunoassay kits which test for current or previous infection caused by the Neisseria gonorrhea bacterium.

Buyer Products:

  • Abbott Laboratories Neisseria gonorrhea Test
  
Viral  
Hepatitis
Immunoassay kits which tests for current or previous infection caused by Hepatitis viruses.

Buyer Products:

  • Abbott Laboratories HCV Assay
  
Human Immunodeficiency Virus (HIV)  
Serum  
Genotyping
Tests that "fingerprint" HIV according to chromosomal makeup in order to track specific strains.

Buyer Products:

  • Celera Diagnostics ViroSeq HIV-1 Genotyping System
  
Microbiology  
Genetic Probes/PCR  
Automated Analyzers
Analyzers designed for genetic probe assays.

Buyer Products:

  • m2000 System
  
Reagents  
Bacterial  
Chlamydia
Genetic probes for detection of Chlamydia organisms.

Buyer Products:

  • Abbott Laboratories Chlamydia Test
  
Viral  
Human Immunodeficiency Virus (HIV)
Genetic probes for detection and quantification of HIV.

Buyer Products:

  • Abbott Laboratories HIV-1 Real-Time PCR Viral Load Test
  
Outsourced Services
Development/Manufacturing Services  
Contract Manufacturing Organizations (CMO)  
Medical Devices
Contract Manufacturing Organizations that manufacture (and/or design, develop) medical devices and products for other organizations.

Buyer Products:

  • Celera Genomics Contract Manufacturing
  
Drug Delivery Technology  
Oral Delivery  
Hydrogel Based/Polymer Coated
Drug Delivery Technologies used to deliver drugs in a jelly like base which are enclosed using a polymer matrix.

Target Products:

  • SyncroDose
  • Geminex
  • TIMERx
  
Polymer Coated
Drug Delivery Technologies used to deliver drugs in a polymer based matrix to hold/enclose the drug.

Target Products:

  • Gastroretentive Drug Delivery System
  
Drug Discovery Services  
Target Discovery/Validation  
Databases  
Genomics  
Animal
Genomic databases that contain animal genetic information.

Buyer Products:

  • Celera Discovery System
  
Human
Genomic databases that contain human genetic information.

Buyer Products:

  • Celera Discovery System
  
Scientific Products  
Consumables  
Bioanalytical Chemistry  
Molecular Biology  
Electrophoresis  
Gel Electrophoresis (GE)  
Reagents  
Genotyping
A type of gel electrophoresis chemical that is used for the analysis and detection of genetic samples.

Buyer Products:

  • Celera Diagnostics Cystic Fibrosis Analyte Specific Reagents
  
Nucleic Acid Analysis  
Kits  
Polymerase Chain Reaction (PCR)  
Detection
Polymerase chain reaction (PCR) consumables used for the detection of genetic samples.

Buyer Products:

  • Fragile X (FMR-1 Gene) Analyte Specific Reagents
  • Celera Diagnostics HLA Sequencing-Based Typing Products
  • Celera Diagnostics Hepatitis C Virus (HCV) Genotyping Analyte Specific Reagents
  • Deep Vein Thrombosis Analyte Specific Reagents
  
Quantitation
Polymerase chain reaction (PCR) consumables used for the quantifation of genetic samples.

Buyer Products:

  • Celera Diagnostics Hepatitis C Virus (HCV) Quantitative Analyte Specific Reagents
  

- 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
  Quest Diagnostics Incorporated n/a 11,032.253 19.81 19.86 1.75 1.63 n/a
Laboratory Corp. of America Holdings n/a 9,141.189 19.68 18.39 2.37 2.22 n/a
Affymetrix, Inc. n/a 1,850.658 n/a 105.56 5.18 4.87 4.72
Cepheid n/a 1,287.936 n/a -70.42 12.87 10.63 18.39
Genomic Health, Inc. n/a 577.410 n/a -18.47 12.97 8.63 7.17
Third Wave Technologies, Inc. n/a 399.647 n/a -14.76 14.55 12.61 11.69
Helicos BioSciences Corp. n/a 270.135 n/a -4.57 686.74 400.34 4.36
Rosetta Genomics Ltd. (USA) n/a 81.473 n/a -7.94 n/a 80.90 2.44
RegeneRx Biopharmaceuticals, Inc. n/a 76.348 n/a n/a 282.76 n/a 6.78
Lumera Corporation n/a 76.210 n/a n/a 19.13 n/a 3.16
Nanogen, Inc. n/a 68.450 n/a n/a 1.89 n/a n/a
Compugen Ltd. (USA) n/a 65.055 n/a n/a 5,760.60 n/a 3.03
Target
  Johnson & Johnson n/a 190,863.999 18.04 16.24 3.34 3.16 13.68
Elan Corporation, plc (ADR) n/a 10,448.804 n/a -34.81 15.97 14.04 n/a
Biovail Corporation (USA) n/a 2,858.171 13.02 10.20 2.75 3.44 4.70
King Pharmaceuticals, Inc. n/a 2,574.611 8.36 5.85 1.25 1.23 1.90
K-V Pharmaceutical Company n/a 1,505.213 31.66 n/a 3.96 n/a 6.07
Alpharma Inc. n/a 929.815 16.08 22.14 1.36 1.29 1.93
Eurand N.V. n/a 731.542 n/a -79.52 6.39 6.35 9.57
Ligand Pharmaceuticals Inc. n/a 603.788 1.51 2.18 8.33 n/a 12.96
SkyePharma PLC (ADR) n/a 256.721 n/a -4.63 2.48 3.36 n/a
SCOLR Pharma Inc. n/a 128.925 n/a n/a 37.40 n/a 9.30
BioDelivery Sciences International, Inc. n/a 66.577 n/a -2.23 24.06 n/a n/a
Elite Pharmaceuticals, Inc. n/a 49.101 n/a -4.42 35.58 6.30 3.48
Purdue Pharma L.P. 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
Target
  Mylan Inc. n/a 3,903.698 17.63 12.21 2.17 1.39 5.06
DRAXIS Health Inc. (USA) n/a 226.270 22.92 26.80 2.63 2.60 2.15

- 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
Buyer
  Merck & Co., Inc. n/a 116,066.607 24.20 17.22 4.97 4.76 6.74
Bayer AG (ADR) n/a 62,255.645 10.68 15.95 1.40 1.36 n/a
Quest Diagnostics Incorporated n/a 11,032.253 19.81 19.86 1.75 1.63 n/a
Laboratory Corp. of America Holdings n/a 9,141.189 19.68 18.39 2.37 2.22 n/a
MDS Inc. (USA) n/a 2,652.969 3.27 52.68 2.34 2.29 6.16
Cepheid n/a 1,287.936 n/a -70.42 12.87 10.63 18.39
Genomic Health, Inc. n/a 577.410 n/a -18.47 12.97 8.63 7.17
Specialty Laboratories, Inc. n/a n/a n/a n/a n/a n/a n/a
Target
  Mylan Inc. 89.10% 3,903.698 17.63 12.21 2.17 1.39 5.06
sanofi-aventis (ADR) n/a 120,772.157 22.87 12.33 2.99 3.11 n/a
Endo Pharmaceuticals n/a 3,759.637 21.20 16.09 3.80 3.55 4.11
Merck KGaA 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
  General Electric Company n/a 420,400.759 19.67 18.82 2.53 2.50 22.72
Roche Holding Ltd. (ADR) n/a 158,366.482 21.04 19.17 4.13 4.04 6.18
Merck & Co., Inc. n/a 116,066.607 24.20 17.22 4.97 4.76 6.74
Abbott Laboratories n/a 81,352.647 42.24 18.92 3.37 3.26 473.16
Genentech, Inc. n/a 81,346.724 31.11 27.75 7.43 6.82 8.93
Bayer AG (ADR) n/a 62,255.645 10.68 15.95 1.40 1.36 n/a
Laboratory Corp. of America Holdings n/a 9,141.189 19.68 18.39 2.37 2.22 n/a
Applied Biosystem Inc. n/a 6,600.199 36.79 22.70 3.15 2.94 5.12
Beckman Coulter, Inc. n/a 4,627.445 21.40 23.30 1.75 1.67 18.67
MDS Inc. (USA) n/a 2,652.969 3.27 52.68 2.34 2.29 6.16
Medarex, Inc. n/a 1,776.572 n/a -100.64 37.72 38.72 3.25
Cepheid n/a 1,287.936 n/a -70.42 12.87 10.63 18.39
Seattle Genetics, Inc. n/a 868.795 n/a -18.84 58.02 38.98 11.67
Genomic Health, Inc. n/a 577.410 n/a -18.47 12.97 8.63 7.17
Pharmacyclics, Inc. n/a 61.545 n/a -1.66 483.87 n/a 1.60
Bayer Schering Pharma AG n/a n/a n/a n/a n/a n/a n/a
Specialty Laboratories, Inc. n/a n/a n/a n/a n/a n/a n/a
Target
  sanofi-aventis (ADR) n/a 120,772.157 22.87 12.33 2.99 3.11 n/a
Mylan Inc. n/a 3,903.698 17.63 12.21 2.17 1.39 5.06
Endo Pharmaceuticals n/a 3,759.637 21.20 16.09 3.80 3.55 4.11
DRAXIS Health Inc. (USA) n/a 226.270 22.92 26.80 2.63 2.60 2.15
Pharmaceutics International, Inc. n/a n/a n/a n/a n/a n/a n/a
Edison Pharmaceuticals, Inc. n/a n/a n/a n/a n/a n/a n/a
Merck KGaA n/a n/a n/a n/a n/a n/a n/a
Otsuka Pharmaceutical Co., Ltd. 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 43.4 3.0 46.4
Other Revenue 0.0 0.0 0.0
Total Revenue 43.4 3.0 46.4
Cost of Revenue 17.6 0.4 18.0
SG&A Expense 29.7 14.2 43.8
Depreciation & Amortization 0.0 0.0 0.0
Research & Development 51.7 23.7 75.4
Interest Expense 0.0 0.0 0.0
Other Operating Expense 0.0 0.0 0.0
Unusual Expense (Income) 8.0 0.0 8.0
Total Expenses 106.9 38.3 145.2
Operating Income -63.5 -35.3 -98.8
Non Operating Items
Interest Expense (Inc.), Net Non-Oprtng 27.8 1.8 29.6
Other, Net 0.5 0.0 0.5
Income Before Taxes -35.2 -33.5 -68.7
Income Taxes -15.5 0.0 -15.5
Income After Taxes -19.8 -33.5 -53.3
Net Income - Excl. Xord. Items -19.8 -33.5 -53.3
Net Income - Incl. Xord. Items -19.8 -33.5 -53.3
Income Avail. to Common -19.8 -33.5 -53.3
Share Items
Basic Avg. Shares Outstanding 78.7 23.2 101.9
Basic EPS - Excl. Xord. Items n/a n/a -0.52
Basic EPS - Incl. Xord. Items n/a n/a -0.52
Full Dilution Adjustment 0.0 0.0 0.0
Fully Diluted Shares Outstanding 78.7 23.2 101.9
F.D. EPS - Excl. Xord. Items n/a n/a -0.52
F.D. EPS - Incl. Xord. Items n/a n/a -0.52
Balance Sheet
Assets
Cash and Equivalents 30.0 21.0 51.0
ST Investments 531.5 16.6 548.1
Accounts Receivable 6.3 0.6 6.9
Inventory 8.8 0.4 9.2
Prepayments and Advances 30.4 0.9 31.3
Other Current Assets 0.0 0.0 0.0
Current Assets 606.9 39.5 646.5
Accum D&A 0.0 0.0 0.0
PPE, Net 7.4 3.6 11.0
Goodwill & Intangibles 3.7 3.1 6.8
Other Assets 0.0 0.0 0.0
Other LT Assets 150.7 5.1 155.8
Total Assets 768.7 51.4 820.1
Liabilities
Accounts Payable 3.0 1.3 4.4
Payable/Accrued 0.0 0.0 0.0
Accrued Expenses 19.3 2.6 21.9
ST Debt 0.0 0.0 0.0
Curr Port of LTD & Cap Lease Oblg 0.0 1.2 1.2
Other (Current) Liabilities 15.5 0.3 15.8
Current Liab. 37.8 5.5 43.3
LT Debt 0.0 10.8 10.8
Total LT Debt 0.0 10.8 10.8
Other LT Liab. 5.0 3.0 8.0
Total Liabilities 42.8 19.3 62.1
Shareholders Equity
Common Stock 0.0 0.0 0.0
Additional Paid in Capital 0.0 220.3 220.3
Retained Earnings 0.0 -188.3 -188.3
Other Equity 725.9 0.1 726.0
Total Equity 725.9 32.1 758.0
Total Liab. & Equity 768.7 51.4 820.1
Shares Outstanding 79.0 23.4 102.4
Cash Flow
Operating Cash Flow
CF Net Income -19.8 -33.5 -53.3
CF Depreciation 6.8 0.0 6.8
CF Deferred Taxes -13.2 0.0 -13.2
Other Non-Cash Items 10.7 0.0 10.7
Change in Working Capital -9.4 4.5 -5.0
Total Cash From Operating Activities -24.9 -29.0 -53.9
Investing Cash Flow (not calculated)
Capital Expenditures -2.4 -2.4 -4.8
Other Investing Cash Flows -19.7 3.4 -16.3
Total Cash From Investing Activities -22.1 1.1 -21.1
Financing Cash Flow (not calculated)
Dividends Paid 0.0 0.0 0.0
Purchase Or Sale of Stock 16.8 3.5 20.3
Purchase and Retirement of Debt 0.0 12.0 12.0
Other Financing Cash Flow 0.0 -0.1 -0.1
Total Cash From Financing Activities 16.8 15.4 32.2
Exchange Rate Effects 0.0 0.0 0.0
Net Change in Cash -30.2 -12.6 -42.8