Future Pak raises cash portion of buyout offer for Vanda

(Reuters) -Contract manufacturer Future Pak said on Thursday it has raised the cash portion of its buyout offer as part of a final attempt to acquire Vanda Pharmaceuticals.

It raised the portion to $8.50-$9.00 per share alongside previously proposed contingent value rights amounting to about $4.27 per share. It had previously offered $7.25 to $7.75 per share in cash for Vanda.

The privately held company said it "requires constructive engagement" from Vanda by June 26 or it will withdraw the offer.

Vanda said it would evaluate the revised, non-binding proposal to determine its action in the best interests of the company and its shareholders.

The latest bid represents a more than two-fold premium to Vanda's last closing price of $5.92. Shares of the Washington-based drugmaker rose more than 9% to $6.47 in morning trading.

Vanda had rejected the earlier proposal, saying it significantly undervalued the company and was not in the best interest of the firm and its shareholders.

Last Thursday, UK-based Cycle Pharmaceuticals also extended an offer to acquire the drugmaker for $8 per share, representing a total cash consideration of $466 million.

Future Pak's offer included contingent value rights, which could provide additional benefits to Vanda shareholders if certain performance targets are met.

Rights-based targets include sales-based payments for Vanda's schizophrenia drug Fanapt. Targets also included $200 million of any license proceeds for Vanda's experimental drug, tradipitant, used to treat of paralysis of the stomach.

The U.S. health regulator is set to decide on tradipitant by Sept. 18.

(Reporting by Sriparna Roy in Bengaluru; Editing by Sonia Cheema, Arun Koyyur and Shailesh Kuber)