Pfizer-Backed Ziarco Said to Mull Sale of U.K. Biotech Firm

  • Sale could fetch over $1 billion, attract other drug firms
  • Ziarco is working with advisers at Rothschild on sale process

Ziarco Pharma Ltd., a U.K. biotechnology company whose investors include Pfizer Inc.’s venture capital arm, is exploring a sale after its experimental dermatology treatments attracted interest from potential buyers, according to people with knowledge of the matter.

Ziarco is working with financial advisory firm Rothschild & Co. on the process, which may start as soon as the coming weeks and lure other drugmakers, the people said, asking not to be identified because the deliberations are private. The sale could fetch more than $1 billion, with part of that coming from an upfront payment and the rest through royalties and after the company achieves certain targets, one of the people said.

No final decisions have been made, and the company may decide against a sale, they said. Representatives for Ziarco and Rothschild declined to comment.

Ziarco, which focuses on the development of novel drugs for the treatment of inflammatory skin disorders, said it got positive results from its first phase 2a proof-of-concept study for ZPL-389, a treatment for moderate-to-severe atopic dermatitis, this month.

Still, ZPL-389’s affect on itching associated with the disease, the trial’s primary endpoint, wasn’t statistically significant after eight weeks of treatment, Ziarco said. People who have the disorder, the most common form of eczema, need oral options for treatment that are safe, effective and well-tolerated, the company said. A longer, 12-week trial is planned to start later this year, Ziarco said.

A Ziarco sale would represent a relatively rare deal for Europe’s biotechnology industry as most buyers focus on the U.S. as the main market for growth. Founded in 2012, Ziarco’s investors include Pfizer Venture Investments, Amgen Inc.’s Amgen Ventures and Lundbeckfond Ventures, which is the controlling shareholder in Danish health-care companies H. Lundbeck A/S and ALK-Abello A/S.

Beleaguered Canadian drugmaker Valeant Pharmaceuticals International Inc. is exploring a sale of its own dermatology units, people familiar with the matter have said. The company is working with Morgan Stanley as it weighs selling Obagi Medical Products and Solta Medical to raise cash and reduce debt, they said.

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