Amgen buys Onyx for $10.4 billion
pharmafile | August 27, 2013 | News story | Research and Development, Sales and Marketing | Amgen, Kyprolis, Onyx
Amgen and Onyx Pharmaceuticals’ intricate dance around one another has reached its conclusion with the US companies’ announcement of a $10.4 billion sale.
Amgen, the largest biotech company in the world with a market cap of $85 billion, is paying $125 per share to own cancer drugs specialist Onyx.
This is $5 per share more than the offer Onyx rejected a couple of months ago: at the time Onyx said the offer ‘significantly undervalued’ the company and that it would now be seeking other suitors.
But the partners have now been reconciled, with the extra cash ending Onyx’s resistance “after a careful and thorough evaluation process”, according to Onyx chief executive Tony Coles.
For its part Amgen believes the deal: “Will accelerate growth and enhance value” for shareholders: the firms are expected to formally sign on the dotted line around October.
According to Bloomberg, one analyst believes that the deal will increase Amgen’s earnings per share by 22% by 2018 – and if this proves to be correct it will be largely down to the performance of one drug: Onyx’s blood cancer brand Kyprolis.
Onyx has a co-development deal with Bayer for the liver and kidney cancer medicine Nexavar and co-markets Stivarga for stomach cancer with Bayer – but it is Kyprolis which holds the key to this deal.
Onyx has global rights outside Japan for the product, which has orphan drug designation in the US with exclusivity until July 2019, and patents extending until at least 2025.
Analysts predict it could make $3 billion a year by 2021.
“Amgen has a unique opportunity to add value to Kyprolis, a product which is at an early and promising stage of its launch,” explained Amgen chief executive Robert Bradway.
“We believe that Amgen is ideally suited to realize the full potential of Onyx’s portfolio and pipeline for the benefit of physicians and patients,” he added.
Onyx’s other oncology compounds, in various stages of clinical development, will join nine Amgen products – four of which are investigative, first-in-class oncology treatments – which are expected to be registered by 2016.
“Our two companies share a strong culture of innovation and a focus on patient needs,” Bradway went on. “I look forward to bringing the talented people of Onyx and Amgen together as we continue to fulfill our commitment to unlocking the potential of biology for patients suffering from serious illnesses.”
Amgen is certainly staking a lot on the deal, which is the company’s second biggest after its 2001 purchase of Immunex for just under $17 billion.
Adam Hill
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