.jpg){kind=link}
Apotex already owned 30% of Talicia. On August 31, it bought the rest.
RedHill Biopharma sold its 70% stake in Talicia — an antibiotic that treats H. pylori, the stomach infection behind most gastric ulcers — to a subsidiary of Apotex Health Corp. for $18 million in cash, with the potential for up to $35 million more tied to worldwide net sales milestones. Apotex had picked up its existing minority stake through its prior acquisition of Cumberland Pharmaceuticals' U.S. branded business, which included Cumberland's 30% share in the Talicia holding structure.
Shares closed 36.16% higher at $0.9000 after the announcement, on dollar volume of about $141 million across roughly 397,000 trades.
For anyone holding the stock, the deal trades a revenue-generating asset for cash and a wager on what RedHill buys next. The company says it intends to use the proceeds to acquire new FDA-approved commercial products — but named no target, price range or timeline in the filing.
The sale carries a five-year non-compete covering the U.S. and its territories: RedHill cannot sell a competing H. pylori product in its core market for the duration. RedHill will also provide transition services to Apotex for an initial six months, with an option to extend for three more months for limited services, according to the 6-K filed with the SEC on August 31.
CEO Dror Ben-Asher said in the company's release that the transaction "unlocks the resources needed to scale RedHill's existing gastrointestinal commercial franchise into a stronger and larger one, including new, high-value, FDA-approved product opportunities." No acquisition target was disclosed.
More than half of the session's reported volume — 55.99% — was short volume. The filing does not address the composition of the day's trading.
The milestone payments depend on Apotex growing Talicia's sales — a product RedHill has now agreed not to compete against. Whether that upside materialises is entirely outside RedHill's control from here.