Biotech Mergers Continue (LGND, PCOP)
There have been many biotech merger announcements of late, and tonight there is a small deal to report. Ligand Pharmaceuticals Incorporated (NASDAQ: LGND) is acquiring Pharmacopeia (NASDAQ: PCOP) in a deal valued up to $70 million. The terms of this are tricky as it is dependent upon share prices and upon a Contingent Value Right which could yield additional rewards to holders.
You can read about the FULL DEAL DETAILS at 24/7 Wall St.
Pharmacopeia, the target, shares closed down almost 5% in regulartrading and its shares are up 33% at $1.59 in after-hours trading. Its 52-week trading range is $1.00 to $6.10.
Ligand, the acquirer, closed up less than 1% at $3.12 in regular trading and its shares are up less than 1% at $3.14 in after-hours trading. Its 52-week trading range is $2.16 to $6.21.
Jon C. Ogg
September 24, 2008
It Will Take Much More to Buy Genentech (DNA)
The Board of Directors of Genentech, Inc. (NYSE: DNA) had already appointed a special committee to review the $89.00 cash buyout for the rest of the company that Roche did not already own. The committee responded today with a “NO, WE WANT MORE!” response to Roche.
In the press release, it announced that it has unanimously concluded that Roche’s proposal to acquire Genentech for $89.00 per share substantially undervalues the company and the special committee does not support the current proposal.
If you read the release, you can see they are demanding more cash to take the stock out.
- “However, the special committee would consider a proposal that recognizes the value of the company and reflects the significant benefits that would accrue to Roche as a result of full ownership.”
If you’d like our prediction, we are happy to give it. We think that the company is willing to be acquired, but a price of $99 to $106 is what the buyout will take to complete. But if Genentech says that it will not play at those levels then roche may threaten to unload a larger portion of the stock.
Jon C. Ogg
August 13, 2008
When Biotechs Cancel Conference Presentations (ALNY)
There was an intersting note out of Alnylam Pharmaceuticals Inc. (NASDAQ: ALNY). The company has withdrawn from an upcoming investor presentation for this coming Friday.
While it is very possible that this is something completely harmless or just over a scheduling conflict, traders right now are looking for any and all things that could point to the next buyout candidate in a rapidly consolidating biotech sector.
Whether or not anything comes from that or whether this is just noise will be debated by traders and analysts alike. We saw 17,371 shares trade after the close, but a few hundred shares traded up at $36.00 since after this news was released.
JON OGG
AUGUST 4, 2008
Is BioMarin the Next Biotech Takeover Candidate? (BMRN)
Everyone is looking fo rthe next biotech takeover candidate for their investment portfolios, but you can’t look at just market caps nor just at sales. Those are critical because many aren’t worth the time for larger players, but you also have to consider the pipeline and have to consider its partnerships and total reach that can be attained (among other issues).
BioMarin Pharmaceutical Inc. (NASDAQ: BMRN) is one of the biotech players that has come up over and over in the last couple of years over its market cap and with 2008 being the year that its revenues finally start to ramp up. It showed $121 million in 2007 revenues, and analysts are looking for $312 million in 2008 and over 4420 million in 2009. This is also the year its P/E is finally supposed to go positive with analysts looking for $0.49 EPS for 2008 and $1.13 EPS for 2009.
It also has partnerships with the following:
- Genzyme (NASDAQ: GENZ) for the development and commercialization of Aldurazyme® (laronidase) for MPS I;
- Alliant Pharmaceuticals for the North American commercialization of the Orapred product line, including Orapred ODT (prednisolone soduim phosphate orally disintegrating tablets)’
- and Merck Serono for the development and ex-U.S./ ex-Japan/ ex-Canada commercialization (pending regulatory approvals) of BioMarin’s Kuvan and 6R-BH4 for other indications.
The company also just yesterday announced that Summit plc signed a worldwide licensing agreement for Duchenne Muscular Dystrophy program.
This was mentioned as a potential buyout candidate yesterday by an analyst on CNBC. Shares closed up $1.21 at $31.40 yesterday and shares are up 1.5% at $31.90 at 9:54. Its 52-week trading range is $17.63 to $41.00.
Whether or not this is the next biotech to fall is still an unknown. But it fits the bill and this is one that traders seem to be putting funds toward over the last couple of weeks.
Jon Ogg
July 23, 2008
If Genentech Is Acquired, Others May Follow (DNA, AMGN, BIIB, GENZ, GILD, CELG, IMCL)
Genentech (NYSE: DNA) is just one of the next biotechs (and just large companies on discount for that matter) that is likely to disappear as far as US-based shareholders are concerned. The largest biotech company by market cap has been offered $89.00 per share in cash by parent Roche for the 44% minority stake it doesn’t own.
Genentech shares are trading over $90.00 as it is believed that if Roche wants to recapture this after a 25 year history of being public that it might have to go closer to $100.00. We’d watch other biotech Amgen (AMGN), Biogen-Idec (BIIB), Genzyme (GENZ), Gilead (GILD), Celgene (CELG), ImClone (IMCL) and others on this.
The US-biotech and other critical spaces may about to be getting much smaller.
JOn Ogg
July 21, 2008