Alza to Buy Therapeutic for $100 Million

Alza Corp. agreed to buy Therapeutic Discovery Corp. for $100 million, or $12.30 a share, reacquiring the developer of drug delivery systems that it spun off in 1993. Alza makes and licenses drugs that use novel delivery systems, such as skin patches, and Therapeutic Discovery develops the delivery systems for the drugs. At the time of the spinoff, Alza received an option to buy back Therapeutic Discovery’s Class A stock, which represents virtually all of its equity. “Therapeutic Discovery’s goal was to develop a number of products and get them far enough along so that Alza would buy them,” said Alza spokeswoman Patty Eisenhaur. Therapeutic Discovery had a 1996 loss of $94.8 million, or $12.25 a share, and no revenue. The company has never been profitable. Alza reported 1996 income of $92.4 million, or $1.08 a share, on sales of $411.2 million. Both companies are based in Palo Alto. Shares of Alza fell 44 cents to close at $28.94 on the New York Stock Exchange; shares of Therapeutic Discovery rose 19 cents to close at $12.06 in Nasdaq trading.