Cubist Pharmaceuticals, Inc.

Cubist Pharmaceuticals, Inc. was an American biopharmaceutical company focused on the research, development and commercialization of pharmaceutical products addressing unmet medical needs in the acute care environment, with an emphasis on antibiotics for serious and potentially life-threatening infections caused by increasingly drug-resistant bacteria, including pathogens such as MRSA. The company was incorporated in Delaware and traded on the NASDAQ Global Select Market under the ticker CBST until its acquisition by Merck & Co.

Its principal marketed product was CUBICIN (daptomycin for injection), described as the first antibiotic in the United States in a class of anti-infectives called lipopeptides and the only approved once-a-day therapy for both S. aureus bacteremia and complicated skin and skin structure infections; the drug had been used to treat more than two million patients as of December 2014. Cubist also promoted MERREM I.V. (meropenem for injection), an antibiotic developed by AstraZeneca, beginning in 2008, and co-marketed Optimer Pharmaceuticals' fidaxomicin (DIFICID). Its pipeline addressed Gram-negative bacterial infections, Clostridioides difficile infection and respiratory syncytial virus (the latter through a collaboration using Alnylam Pharmaceuticals' RNA-interference technology), and included ZERBAXA (ceftolozane/tazobactam), which was pending FDA approval at the time of the Merck transaction, and tedizolid (SIVEXTRO), approved by the FDA on June 20, 2014.

Founding story

Cubist was founded in May 1992 by John K. Clarke, Paul R. Schimmel, Ph.D. and Barry M. Bloom, Ph.D., who also served on its board of directors.

Business model

Cubist discovered, developed, manufactured and commercialized prescription anti-infective medicines, generating revenue from product sales into the hospital and acute care setting, supplemented by in-licensing, co-promotion and co-marketing arrangements (for example promoting AstraZeneca's MERREM I.V. and co-marketing Optimer's fidaxomicin for a stated $15 million per year) and by acquiring other antibiotic developers to expand its portfolio.

Sales of marketed antibiotics, principally CUBICIN, together with promotion and co-marketing fees from partnered products. The company reported full-year total net revenues of $1.1 billion in 2013 and revenue of $926.4 million in 2012.

Traction

CUBICIN had been used to treat more than two million patients as of December 2014. Total net revenues reached $1.1 billion in 2013, up from $926.4 million in 2012. Global headcount grew to approximately 960 in 2014, up 35% from 2012, with about three of every four employees focused on antibiotic research, development, commercialization and support. Merck expected the acquisition to add more than $1 billion of revenue to its 2015 base.

Latest developments

Merck announced a definitive agreement to acquire Cubist on December 8, 2014 for $102 per share in cash, a 35% premium to Cubist's average share price over the prior five trading days, representing an $8.4 billion equity valuation and approximately $9.5 billion including $1.1 billion of net debt. Merck completed the tender offer on January 21, 2015, with about 75.7% of fully diluted shares tendered, and completed the second-step merger the same day; Cubist's stock ceased trading on NASDAQ. Robert J. Perez succeeded Michael Bonney as president and CEO effective January 1, 2015.