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Cindy Whitehead started Sprout Pharmaceuticals and created the drug ADDYI, which has become known as the “female Viagra”.
After years of fundraising to finance clinical trials and research, Whitehead finally got ADDYI approved by the Food & Drug Administration (FDA) in the United States. With approval to market the drug, Whitehead became the darling of the pharmaceutical industry and she quickly received three competing offers from large pharmaceutical companies to buy her business.
In 2015, Whitehead agreed to be acquired by Valeant, who paid her and her investors a cool $1 billion in cash for the drug, along with a royalty stream from the sales of ADDYI post acquisition.
And that’s about when things got interesting.
Valeant started to come under criticism for hiking the price of some drugs. The company’s stock price plummeted more than 90% and Valeant began circling the wagons. Valeant never launched ADDYI, so there were no royalties paid. Whitehead and her investors sued Valeant for the lost royalty stream.
The two parties have apparently reached a deal where Whitehead and her investors will get the drug back from Valeant and get to keep the billion dollars cash they were paid.
Now that’s an exit!
In this episode, you’ll learn:
Whitehead started Sprout Pharmaceuticals after selling her first company, Slate Pharmaceuticals. Sometimes your best exit happens after you have one or two more modest wins under your belt. If you’re at a cross roads and think now might be the time to get out of your current business and start something new, considering leveraging The Value Builder System™—you can get started for free by completing the Value Builder Score questionnaire.