Wayne, Pa.-based Shire’s $2.6 billion acquisition of New River Pharmaceuticalswill mean one less biotechnology company in Virginia.
Pharmaceutical giant Shire announced the acquisition Tuesday and plans to have the deal finalized in the second quarter of this year, Shire spokesman Matt Cabrey said.
Shire likely will close New River Pharmaceuticals, which has about 50 employees including its executive team, in Radford once the deal is complete, Cabrey said.
Shire purchased New River in order to gain access to an ADHD medication in the biotech’s portfolio. Vyvanse is a safer alternative to Shire’s ADHD medication Adderall XR, which has a higher potential for patient abuse. Vyvanse, which expects approval from the Food and Drug Administration by Friday, will also have a patent through 2024, while a generic brand of Adderall will be available in 2009.
The deal is a win for New River Pharmaceuticals, but the fact that the company will no longer have a presence in Virginia could be considered a setback for the state’s biotech industry. Biotech startups in Virginia and Maryland have struggled to keep pace with thriving life science industries in other parts of the United States. Some economic development officials have said the industry’s success depends on growing the companies in the region, rather than selling them off to bigger pharmaceuticals elsewhere.
New River is not the first biotech firm to leave the region as the result of an acquisition. Invitrogen acquired Gaithersburg-based Life Technologies, Inc. in 2000 and moved its offices and employees to the company’s San Diego headquarters.
“It all depends on the specifics of the deal,” MdBio President Robert Eaton said. “If a company were to acquire [a local biotech] and leave them in place here as a division that’s one thing.” MdBio represents Maryland’s biotech industry.
Even if a company does leave the area, employees sometimes stay behind and ultimately contribute to the industry, Eaton said. For example, some Life Technologies employees stayed in Maryland to work for other biotechs.
Ultimately, balancing the individual company’s interests with the region’s needs is a formidable task.
“It’s very difficult,” Eaton said. “There’s no easy answer one way or the other.”
The Associated Press contributed to this story.
