Aralez Pharmaceuticals has signed 15-year lease for 36,600 square feet of office space at 400 Alexander Park for its new U.S. headquarters. Aralez is a multinational pharmaceutical company headquartered in Ontario, with offices in Ireland and New York. The company was created in February when New York-based Pozen acquired Canadian Tribute and based the newly merged company in Canada.
A spokesman for Woodmont Properties, the developer that owns the Alexander Road property, said the new tenant will occupy the third and fourth floors of the building.
Woodmont recently began an $11 million upgrade of the building to make it more environmentally friendly and make it eligible for LEED certification.
“With everything from its floors to its facade having been upgraded with sustainable and environmentally friendly materials, 400 Alexander is essentially a brand new building,” said Eric Witmondt, CEO of Woodmont Properties. “In addition to the modernization of the property, the company was drawn to the boutique building’s smaller floor plates and higher window ratio, which allow more natural light to fill the space. We look forward to building a long-term relationship with our newest tenant.” In its most recent annual report, Aralez said it planned to move into the new headquarters in the third quarter of 2016.
Aralez makes migraine medication Cambria, Fiorinal for headaches, and expects to launch Yosprala for heart health, which is a combination of aspirin and gastric protecting drug omeprazole, before the end of 2016 pending FDA approval. It also makes heart drugs Bezalip, Fibricor, Viskazide, and Visken.
The $146 million all-stock Pozen-Tribute merger included a $350 million investment from Deerfield, a syndicate of healthcare investors.
Before the merger was finalized in February, the company had planned to locate its new headquarters in Ireland. But the deal took place at a time when American authorities were rewriting regulations to limit “corporate inversion” deals where American drug companies would relocate their headquarters overseas in order to pay lower tax rates. In November, Pozen, citing “Treasury Department Guidance,” changed its plans and decided to locate the combined company in Canada instead.
“During 2015 and continuing into this year, we have witnessed changing dynamics in the specialty pharmaceutical sector driven by significant pricing scrutiny by the public, politicians, including the presidential candidates, and payors. In addition, political rhetoric around offshore companies such as Aralez with operations in the U.S., and the issues creating a decline in value by some of our competitors, contributed to sector underperformance. We believe the reputational damage caused by a small number of specialty companies are not reflective of the sector or Aralez’s differentiated strategy,” CEO Adrian Adams wrote in the company’s 2016 annual report.
In a press release, the company said a Canadian headquarters offered similar financial, tax, and competitive advantages to an Irish domicile, and would benefit from Tribute’s existing presence in Canada.
Aralez’s senior management team has few connections to Route 1 companies. Mark A. Glickman, chief commercial officer, was VP at Otsuka, which is headquartered at Carnegie Center. Adams joined Pozen in 2015 and was previously CEO of Auxilium, Neurologix, Inspire Pharmaceuticals, Sepracor, and Kos Pharmaceuticals. Earlier in his career he held management positions at ICI, SmithKline Beecham and Novartis. He is a graduate of Salford University in Britain.
In its most recent annual report filed with the SEC, Aralez said it planned to solidify its position in the heart disease and pain drug market while aggressively pursuing licensing and strategic mergers and acquisitions.
Adams said the company is preparing to heavily market Yosprala if and when it is approved, with a force of 110 sales representatives. The drug is intended to prevent heart attack and stroke in patients at risk for developing aspirin-induced ulcers. The company hopes the new drug can be marketed to about a third of the 18 million Americans who currently take aspirin for heart health.
In its public filings, Aralez did not explain its reasoning for relocating its headquarters from New York to Princeton, and a company spokesperson did not immediately return a phone message asking for comment.