Some think this is the classic Philadelphia story: Club boxer gets his shot at the heavyweight title and shocks the world.
To me, the classic Philadelphia story is: Businessman starts a company. Son takes over and sends it to new heights.
No, I’m not referring to Comcast Corp., founded in 1963 by Ralph J. Roberts and now led by his son, Brian L. Roberts, who oversaw the transactions that turned it into a media giant.
Today, I’m talking about a different Roberts family, which built a small specialty-drug company into something a Japanese pharmaceutical power felt was worth spending at least $800 million to acquire.
United Research Laboratories Inc. was begun in 1946 by chemist Albert Roberts, making adrenocorticotropic hormone for doctors to treat patients with arthritis. In the 1980s, Roberts and his brother, Theodore, started a generic-drug arm called Mutual Pharmaceutical Co.
Richard H. Roberts joined his father, Albert, in the family business in 1988 and spent his time figuring out which brand-name drugs about to lose patent protection would make good targets for URL/Mutual’s lower-cost generic versions.
In 1997, Richard Roberts became chairman, president, and CEO of the company, based in the city’s Juniata Park section, as part of the sale of a majority interest to two New York venture-capital firms, Elliott Associates L.P. and Momar Corp.
Renamed URL Pharma Inc. in 2008, the company is probably unfamiliar to anyone who doesn’t have gout or doesn’t treat some of the more than eight million Americans diagnosed with the painful disease. That’s because its brand-name Colcrys drug costs far more today than the 9 cents per dose that the longtime remedy, called colchicine, once did.
Call it an unintended consequence of a program by the Food and Drug Administration to encourage clinical trials of medicines that predated federal regulation for safety and effectiveness. URL Pharma was the only drug company to seek approval for colchicine under the Unapproved Drug Initiative.
After its Colcrys received the FDA’s OK in 2009 and three years of market exclusivity, URL Pharma raised the price to about $5 per pill, causing a furor in the medical community as the company’s revenue and profit swelled.
Such success attracted Takeda Pharmaceutical Co. Ltd., Japan’s largest drug company, which agreed to buy URL Pharma this week for $800 million, with more possible, based on certain goals.
Takeda, whose U.S. base is in Deerfield, Ill., clearly wanted URL Pharma for Colcrys, which generated net sales of more than $430 million in 2011. Takeda has its own gout medicine, called Uloric, with sales of $106 million for the 12 months ended March 31, 2011.
When the deal closes in about 60 days, URL Pharma and its 500 employees will be absorbed by a firm that has grown from three U.S. employees in 1998 to more than 2,800 by 2011’s end.
That makes URL Pharma’s acquisition even more of a Philadelphia story than Comcast as it becomes the latest in a long line to say “yes” to an eye-popping buyout offer.
Contact Mike Armstrong at 215-854-2980 or firstname.lastname@example.org, or follow on Twitter @PhillyInc. Read his blog, “PhillyInc,” at www.phillyinc.biz.