On October 31, 2019 Sumitomo Dainippon Pharma Co., Ltd. (TSE: 4506), a leading Japanese pharmaceutical company, and Roivant Sciences Ltd., a technology-enabled healthcare company, reported that they have signed a definitive agreement for the creation of a novel and broad Strategic Alliance and to form a new company (the "New Company") owned and supported by Sumitomo Dainippon Pharma (Press release, Sumitomo Dainippon Pharma, OCT 31, 2019, View Source [SID1234550155]).

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As previously announced, this will include the transfer to Sumitomo Dainippon Pharma of Roivant’s ownership interests in five of their biopharmaceutical companies ("Vants") and access to Roivant’s proprietary technology platforms, DrugOme and Digital Innovation. In addition, Sumitomo Dainippon Pharma will take an equity stake of over 10% of shares outstanding in Roivant and will have options (the "Options") to acquire Roivant’s ownership interests in up to 6 additional Vants by 2024. These 11 Vants collectively have more than 25 innovative clinical programs, with multiple potential product launches expected from 2020 to 2022.

The transaction will be subject to customary closing conditions and any required governmental approvals. Roivant will receive USD $3 billion from Sumitomo Dainippon Pharma as a payment to enter the Alliance. Exercise of the Options by Sumitomo Dainippon Pharma will trigger additional payments to Roivant. In addition, Sumitomo Dainippon Pharma will enter separate strategic client relationships with Datavant and Alyvant to augment development and commercialization activities.

In addition to Myovant Sciences, Urovant Sciences, Enzyvant Therapeutics, and Altavant Sciences, the fifth Vant in the Alliance will be Spirovant Sciences, a newly unveiled Vant focused on developing innovative gene therapies for cystic fibrosis.

Sumitomo Dainippon Pharma plans to provide financial support to the five Vants in the New Company and intends to leverage potential benefits associated with Sumitomo Dainippon Pharma’s global commercial infrastructure. The New Company will be led by CEO Myrtle Potter, Vant Operating Chair at Roivant Pharma. Additional management team members will include Adele Gulfo, Chief of Commercial Development at Roivant Pharma, Dr. Sam Azoulay, Chief Medical Officer at Roivant Pharma, and Dan Rothman, Chief Information Officer.

Prior to joining Roivant, Ms. Potter served as President and Chief Operating Officer of Genentech. Under her leadership, Genentech achieved record sales and earnings growth each year. Prior to Genentech she was President of Bristol-Myers Squibb’s U.S. Cardiovascular and Metabolic business. Potter is a graduate of the University of Chicago, and she serves on the university’s board of trustees and also on the board of Liberty Mutual Insurance Group. She has also served on the boards of Amazon, Express Scripts, Medco Health Solutions, and Rite Aid.

"I am happy to announce that we have reached an agreement on the Strategic Alliance with Roivant, one of the strategic investments that we are making to address our challenges laid out in the Mid-Term Business Plan 2022," said Hiroshi Nomura, Representative Director, President and CEO of Sumitomo Dainippon Pharma. "This Strategic Alliance allows us to not only acquire potential blockbusters and innovative health technology platforms developed by Roivant, but it will also enable us to deepen our relationship with Roivant, a company that possesses an innovative business model and underlying culture. We expect this relationship will contribute significantly to the establishment of a position as a ‘Global Specialized Player’ which we aspire to be in by 2033."

"We are proud to enter this unique Alliance with Sumitomo Dainippon Pharma," said Vivek Ramaswamy, Founder and CEO of Roivant Sciences. "We hope that our contributions to this Alliance will enable Sumitomo Dainippon Pharma to realize its vision to be a global leader in the biopharmaceutical industry. In addition, we believe that this Alliance will increase the long-term value of each Vant in the Alliance through a combination of strong financial backing and other capabilities."