SNY Sanofi

By Noemie Bisserbe 

PARIS--French drugmaker Sanofi SA said Wednesday it is moving to call a shareholder vote on whether to remove the entire board of Medivation Inc. after the U.S. biotech firm declined to engage in takeover talks.

Sanofi said it had filed the necessary documents with the U.S. Securities and Exchange Commission and proposed eight candidates to replace Medivation's board of directors. The solicitation aims to pave the way for shareholders to cast votes through written consent.

Medivation swiftly urged its stockholders to reject Sanofi's maneuver, calling it "a tactic for the French firm to facilitate its substantially inadequate and opportunistically timed proposal to acquire Medivation." The company said it expected to "promptly" file its own consent revocation materials with the SEC.

The acquisition of Medivation could help Sanofi expand its new products portfolio and build a competitive position in a hotly tipped market where it is still a small player. Sanofi said late last month it has made an unsolicited offer worth $9.3 billion for Medivation, which the San Francisco-based firm promptly rejected, claiming Sanofi's proposal undervalued the cancer-treatment company.

The attempt to oust the Medivation directors could increase the pressure on them to engage with Sanofi, or move on to find other bidders.

A provision of Delaware law, where Medivation is registered, allows shareholders to remove the board by written consent instead of calling a vote at the general assembly meeting. Sanofi has bought some Medivation shares, according to a person familiar with the matter.

"Despite multiple attempts, both before and following the public disclosure of Sanofi's proposal, Medivation has thus far refused to engage with us regarding the merits of a value-creating transaction," said Sanofi chief executive Olivier Brandicourt.

"Unfortunately, this has left us with no choice but to commence a process to elect directors who are more open to supporting the best interests of Medivation shareholders regarding a potential transaction," he added.

Mr. Brandicourt has told the Medivation board it would raise its offer "if you engage and provide information."

Sanofi's offer is in line with the company's stated strategy to refocus on fewer businesses, while broadening its reach. Last November, the Paris-based company said it would consider acquisitions in several sectors, including oncology.

Medivation, a Nasdaq-listed company that focuses on hard-to-treat cancers, markets one prostate cancer therapy, called Xtandi, and has two additional 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.

Write to Noemie Bisserbe at noemie.bisserbe@wsj.com

(END) Dow Jones Newswires

May 25, 2016 11:38 ET (15:38 GMT)

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