Basics of Salix Pharmaceuticals
Salix Pharmaceuticals (SLXP) is a specialty pharmaceutical company dedicated to developing prescription drugs and medical devices used in the treatment of a variety of gastrointestinal disorders.
Salix Pharmaceuticals’s main products are:
- Xifaxan: indicated for the reduction in risk of overt hepatic encephalopathy
- Apriso: indicated for the maintenance of remission of ulcerative colitis, or UC
- Moviprep: indicated for cleansing of the colon as a preparation for colonoscopy
- Relistor: indicated for the treatment of opioid-induced constipation
- Osmoprep: indicated for cleansing of the colon as a preparation for colonoscopy
- Solesta: indicated for the treatment of fecal incontinence
- Deflux: indicated for the treatment of vesicoureteral reflux
- Fulyzaq: indicated for the symptomatic relief of non-infectious diarrhea in adult patients with HIV/AIDS on anti-retroviral therapy
- Giazo: indicated for the treatment of mildly to moderately active UC
- Metozolv: indicated for the treatment of gastroesophageal reflux disease.
- Azasan: indicated as an adjunct for the prevention of rejection in renal homotransplantations and to reduce signs and symptoms of severe active rheumatoid arthritis
- Anusol: indicated for the relief of the inflammatory and pruritic manifestations of corticosteroid-responsive dermatoses
- Proctocort: indicated for the relief of the inflammatory and pruritic manifestations of corticosteroid-responsive dermatoses
- Pepcis: indicated for the short-term treatment of GERD, active duodenal ulcer, active benign gastric ulcer, erosive esophagitis due to GERD, and peptic ulcer disease
- Diuril: indicated for the treatment of hypertension and also as adjunctive therapy in edema associated with congestive heart failure, cirrhosis of the liver, corticosteroid and estrogen therapy, and kidney disease
- Colazal: indicated for the treatment of mildly to moderately active UC
Xifaxin is by far Salix’s largest product, accounting for about 70% of its revenues in 2013. Xifaxin is a big reason for the Salix–Valeant merger transaction. GI products should account for 24% of Valeant’s (VRX) 2015 pro forma revenues.
Other merger arbitrage resources
Other important merger spreads include the deal between Hospira (HSP) and Pfizer (PFE). For a primer on risk arbitrage investing, read Merger arbitrage must-knows: A key guide for investors.
Investors who are interested in trading in the healthcare sector should look at the Health Care Select Sector SPDR Fund (XLV).