Pharma Company Cosmo Takes 22% Stake in Gastro Treatment Company Redhill

Ireland-headquartered Cosmo Pharmaceuticals NV is acquiring a 21.8% stake in Nasdaq and Tel Aviv-listed pharmaceutical company RedHill Biopharma Ltd., the latter announced in a stock exchange filing Friday. The deal will make Cosmo Redhill’s largest shareholder.  

Under the agreement, Redhill will pay Cosmo the stock equivalent of $12 million, which comes up to 5.9% of Redhill’s shares, for exclusive commercialization rights in the U.S. of Cosmo’s Aemcolo for Traveler's Diarrhea. Redhill has agreed to pay Cosmo up to $100 million dependent on related milestones, as well as royalties. Cosmo will also pay Redhill $36.3 million for 15.9% of Redhill’s shares, pricing them at $7 per share, a 13.5% premium on the company’s price on Thursday’s close.

Founded in 2009, Tel Aviv-headquartered RedHill develops orally-administered medicine for gastrointestinal and inflammatory diseases. RedHill is traded at a market capitalization of around $180 million, as of market close Friday.