Princeton-based Novazyme Pharmaceuticals is being acquired by Cambridge, Massachusetts-based Genzyme.
Novazyme will operate as part of Genzyme General (Nasdaq: GENZ). Genzyme expects that the acquisition will significantly advance its leadership position in the development of enzyme replacement therapies for lysosomal storage disorders, a group of genetic diseases caused by the absence of certain cellular enzymes. Under terms of the agreement, Genzyme will acquire Novazyme for $137.5million, payable in shares of Genzyme General stock. Novazyme shareholdersare also eligible to receive two subsequent payments totaling $87.5 million,payable in stock, contingent on U.S. marketing approval for the first twoproducts employing certain of Novazyme”s technologies.The transaction has received the approval of the boards of both companies, and is expected to close in the third quarter. The acquisition of Novazyme will be accounted for as a purchase transaction and may result in a one-time charge for in-process research and development. Genzyme General expects the transaction to have an impact of approximately $0.03 (excluding amortization) on its earnings-per-share for 2001, reflecting the issuance of approximately 2.5 million new shares at closing and an expected increase in research and development spending of approximately $7 million. Novazyme”s laboratories, offices and manufacturing facility will remain inoperation following the completion of the merger. John Crowley, Novazyme”spresident and chief executive officer, has agreed to serve as a senior vicepresident of Genzyme Therapeutics and will assume overall responsibility forthe company”s Pompe disease programs. He will continue to serve as president of Novazyme, a wholly owned subsidiary of Genzyme. William Canfield, M.D., Ph.D., Novazyme”s founder, chairman and chief scientific officer, has accepted the position of senior vice president for glycobiology and will continue to lead a team of approximately 70 scientists located at Novazyme”s Oklahoma City facilities, which will serve as a glycobiology center of excellence for Genzyme.One of Novazyme”s products, NZ-1001, is an enzyme replacement therapy for Pompe disease that is on track to enter clinical trials by the end of 2001. Genzyme will move forward with the development of NZ-1001, while it simultaneously completes the ongoing Phase 2 clinical trial of its own enzyme replacement therapy for Pompe disease, being developed in collaboration with Pharming Group N.V.
