Sanofi Seeks Talks With Medivation Over $9.3 Billion Offer -- 2nd Update
April 29 2016 - 2:06PM
Dow Jones News
By Noemie Bisserbe
PARIS -- Sanofi SA said Friday it was ready to reach out
directly to Medivation Inc. shareholders, after the U.S. biotech
firm's board rejected its $9.3 billion offer, paving the way for a
protracted takeover battle.
The Paris drugmaker, which has a record of hostile takeovers in
the biotech sector, said it remained "committed" to the transaction
and looked forward to "engaging directly with Medivation
shareholders."
"Combining Sanofi and Medivation represents a compelling
strategic and financial opportunity to drive immediate and certain
value for Medivation's shareholders," Sanofi said.
Sanofi's offer of $52.50 a share was a 50% premium to
Medivation's average share price for the two months before takeover
speculation emerged. It is, however, lower than its current share
price. Medivation's shares rose 0.1% to $56.20 in early trading in
New York, while Sanofi shares closed down 5.4% at EUR72.11 ($82.56)
in Paris.
Earlier Friday, Medivation Inc. dismissed Sanofi's offer, saying
it was "substantially inadequate" and "undervalued" the firm's
innovative cancer drugs.
Medivation, a Nasdaq-listed company that focuses on
hard-to-treat cancers, markets one prostate-cancer therapy, called
Xtandi, and has two other oncology assets in clinical
development.
Xtandi, which the company sells in partnership with Japan's
Astellas Pharma, posted sales of $1.9 billion in 2015. According to
analysts, this number could go much higher if the treatment is
extended to patients in early-stage prostate cancer -- it is today
mostly used by late-stage cancer patients.
A possible takeover of Medivation would allow Sanofi to
significantly ramp up its drugs portfolio at a time when it is
under pressure to launch new innovative medicines to make up for
declining sales of its blockbuster Lantus insulin.
The French drugmaker said Friday that diabetes-drug sales, which
account for about 20% of the company's revenue, fell 6% to EUR1.73
billion in the first-quarter, hurt by a 12% drop in Lantus
sales.
Higher biotech revenue and emerging markets, however, helped
push total net profit 6% higher to EUR1.09 billion for the three
months through March from EUR1.02 billion a year earlier.
Genzyme, Sanofi's biotech unit, posted a 16% jump in revenue to
EUR1.37 billion, boosted by sales of its multiple sclerosis
treatment, Aubagio. Sales of consumer health-care products fell 8%
to EUR905 million while vaccines sales increased 5% to EUR625
million.
Business net income, the company's term for adjusted income
excluding the impact of acquisitions and divestments, declined 0.2%
to EUR1.72 billion, above analysts' expectations of EUR1.69
billion. Sanofi's total sales fell 3% to EUR7.78 billion.
Sanofi has said it expected its business earnings per share to
remain "broadly stable" in 2016 at constant exchange rates,
"barring unforeseen major adverse events."
Write to Noemie Bisserbe at noemie.bisserbe@wsj.com
(END) Dow Jones Newswires
April 29, 2016 13:51 ET (17:51 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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