Sector News

Reuters: Pfizer approaches Medivation about potential takeover

May 5, 2016
Life sciences

Pfizer Inc has approached U.S. cancer drug maker Medivation Inc to express interest in an acquisition, raising the possibility of a bid rivaling a $9.3 billion offer by Sanofi SA, people familiar with the matter said on Tuesday.

Pfizer’s approach comes less than a week after Sanofi went public with its $52.50 per share cash offer, complaining that Medivation refused to engage. Medivation subsequently rejected the offer as too low. Its shares closed on Tuesday at $57.52.

Medivation has not yet decided whether it should engage with Pfizer in negotiations and is in discussions with its financial and legal advisers, the people said. There is no certainty that Pfizer will press ahead with a bid, they added.

Sanofi currently has no plans to raise its offer and is waiting for Medivation to launch an auction to sell itself before it makes any new bid, some of the people said.

The sources asked not to be identified because the matter is not public. Medivation, Sanofi and Pfizer declined to comment.

Based in San Francisco, Medivation is best known for its oncology drug Xtandi, which treats prostate cancer.

For Pfizer, a deal with Medivation would mark another attempt at building scale in patented drugs after it scrapped its $160 billion acquisition of Dublin-based Allergan Plc last month.

The breakdown came days after the U.S. Treasury issued new rules that weighed on Pfizer’s ability to slash its tax bill by using the deal to redomicile in Ireland.

Earlier on Tuesday, Pfizer Chief Executive Ian Read said in an interview with Reuters that he would consider another merger of any size, as long as the deal makes sense. He did not comment on Medivation.

Sanofi is vying for Medivation in an attempt to expand in the lucrative oncology sector, as it struggles to compensate for declining revenues from a key diabetes drug that recently lost patent protection.

Sanofi’s unsolicited approach for Medivation has echoes of its bid for rare disease drug maker Genzyme in 2011. It took Sanofi nine months to overcome Genzyme’s resistance. It also offered Genzyme shareholders so-called contingent value rights, which offered them additional payments if the acquired company was able to achieve certain performance milestones.

Using contingent value rights in the case of Medivation may be more challenging for Sanofi, given its lackluster track record in cancer drugs. However, Sanofi has no plans to use contingent value rights in any new offer, according to the sources.

By Lauren Hirsch and Carl O’Donnell in New York

Source: Reuters

comments closed

Related News

June 22, 2024

Ferring launches online assessment tool, educational platform around male fertility

Life sciences

Because infertility is often branded largely as a women’s issue, many men may be unaware of their own possible role in the matter and may not undergo testing in a timely manner—even though research has shown that men “substantially” contribute to about half of all cases of infertility.

June 22, 2024

Johnson & Johnson blueprints €125M plant upgrade as part of 5-year Italy investment

Life sciences

After plugging nearly 50 million euros into its Italy R&D in the first half of the decade, Johnson & Johnson Innovative Medicine is significantly upping its commitment to the country. Over the next five years, J&J Innovative Medicine, which recently rebranded from Janssen, will plug a projected 580 million euros ($621.7 million) into its Italian business, the company said in a press release.

June 22, 2024

India’s Lupin announces CEO pick for new subsidiary as it moves into the CDMO arena

Life sciences

From vitamin maker to pharmaceutical specialist and now contract manufacturer, India’s Lupin is embarking on a new phase of its corporate journey. Lupin on Monday unveiled its new subsidiary, Lupin Manufacturing Solutions, which is poised to work on the development, production and sale of active pharmaceutical ingredients.

How can we help you?

We're easy to reach