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Pharma‐Bio M&A Deals 2009
Summary – collection of various internet sources
02.02.2010
os
Pharma‐Bio M&A Deals 2009
CONTENT
M&A ACTIVITY IN 2009 ............................................................................................................................ 3
ABBOTT ‐ ADVANCED MEDICAL OPTICS, US$1,300M ......................................................................... 3
BMS AND MEDAREX ‐ $2.4B ............................................................................................................... 3
DAINIPPON ‐ SEPRACOR ...................................................................................................................... 3
GILEAD ‐ CV THERAPEUTICS ................................................................................................................ 4
GLAXOSMITHKLINE AND BRAZIL ‐ $2.2B ............................................................................................. 4
GLAXOSMITHKLINE AND STIEFEL LABS ‐ $3.6B ................................................................................... 4
JOHNSON & JOHNSON ‐ COUGAR BIOTECHNOLOGY ......................................................................... 4
LUNDBECK ‐ OVATION ......................................................................................................................... 4
MERCK AND SCHERING‐PLOUGH ‐ $41.1B .......................................................................................... 5
NOVARTIS AND ALCON ‐ $28.1B ......................................................................................................... 5
ONYX ‐ PROTEOLIX .............................................................................................................................. 5
PFIZER AND WYETH ‐ $68B ................................................................................................................. 5
ROCHE AND GENENTECH ‐ $46.8B ...................................................................................................... 5
ROCHE AND PTC THERAPEUTICS ‐ $2B ............................................................................................... 5
SANOFI‐AVENTIS ‐ CHATTEM .............................................................................................................. 6
SANOFI‐AVENTIS AND MERCK ‐ $4B ................................................................................................... 6
TPG ‐ IMS HEALTH ............................................................................................................................... 6
VARIAN ‐ AGILENT ............................................................................................................................... 6
WARNER CHILCOTT AND P&G ‐ $3.1B ................................................................................................ 6
WATSON ‐ ARROW GROUP ................................................................................................................. 6
SOURCES: ................................................................................................................................................. 7
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Pharma‐Bio M&A Deals 2009
M&A ACTIVITY IN 2009
In 2009, the landscape of mergers and acquisitions (M&As) by the top 50 pharmaceutical companies
(ranked by sales in 2008) was dominated by mega‐mergers, with three deals exceeding the US$40
billion mark.
• Pfizer–Wyeth ($68 billion),
• Roche–Genentech ($47 billion) and
• Merck–Schering‐Plough ($41 billion).
From a strategic perspective, it is clear that the need to fill development pipelines is still a key driver
for acquisitions… for example,
• in June 2009, Bristol–Myers Squibb acquired Medarex for $2.4 billion, gaining control of
Medarex’s clinical‐stage oncology portfolio and its Ultimab antibody development
technology.
Market expansion was also a major driver of acquisitions in 2009…
• The most active company in this area was Sanofi–Aventis, which spent more than $3 billion
on three deals to expand its presence in India, Mexico and Brazil.
However, other companies were not so successful in their M&A activities in 2009.
• For example, CSL and Astellas Pharma failed in their bids to acquire Talecris and CV
Therapeutics, respectively.
without interest and subject to any required
ABBOTT ‐ ADVANCED MEDICAL OPTICS,
withholding taxes.
US$1,300M
The acquisition of AMO enhances and BMS AND MEDAREX ‐ $2.4B
strengthens Abbott's diverse mix of medical
Summary: Anxious to beef up its pipeline as it
device businesses and gives it a leadership
braces for Plavix to go off‐patent, Bristol‐Myers
position in the large and growing eye care
Squibb struck a deal in July to buy Medarex for
market. Abbott Medical Optics holds the
$2.4 billion. The crown jewel of the deal was
number one position in LASIK surgical devices,
ipilimumab, a late‐stage cancer therapy being
the number two position in the cataract surgical
advanced as a new treatment for metastatic
device market and the number three position in
melanoma. The monoclonal antibody also
contact lens care products. The final step in the
turned in impressive results for prostate cancer
acquisition process was a short‐form merger of
and is in testing for lung cancer as well.
Rainforest Acquisition Inc., a wholly owned
subsidiary of Abbott, with and into Advanced DAINIPPON ‐ SEPRACOR
Medical Optics, Inc. As a result of the merger,
September 2009 ‐ Acquisition ‐ Headline value:
all outstanding shares of AMO common stock
$2,600m Definitive agreement pursuant to
not tendered in the cash tender offer (other
which DSP will acquire Sepracor for
than those as to which holders properly
approximately $2.6 billion through a cash
exercise dissenters’ rights) were converted into
tender offer of $23.00 per share, followed by a
the right to receive $22 per share in cash,
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Pharma‐Bio M&A Deals 2009
merger to acquire all remaining outstanding putting itself on the market. A month later, GSK
Sepracor shares at the same price paid in the gobbled up the company for $3.6 billion. CEO
tender offer. The tender offer price represents Andrew Witty said the buyout was part of GSK's
a 48.0% premium to Sepracor’s average stock plan to grow and diversify. The drugmaker has
price over the last six month period ending on combined its existing prescription
September 1, and a 27.6% premium over the dermatological products with Stiefel's business,
closing price of Sepracor’s common stock on giving it 8 percent of the global market for
September 1, 2009. prescription skin drugs. GSK also gained Stiefel's
pipeline of more than 15 candidates in late‐
GILEAD ‐ CV THERAPEUTICS stage trials. Former Stiefel CEO and Chairman
March 2009 ‐ Acquisition ‐ Headline value: Charles Stiefel (whose family owned the
$1,400m Definitive agreement pursuant to company for over 160 years) stayed on as the
which Gilead will acquire CV Therapeutics for new unit's business's chief.
$20.00 per share in cash through a tender offer
JOHNSON & JOHNSON ‐ COUGAR
and second step merger. CV Therapeutics’
BIOTECHNOLOGY
Board of Directors has unanimously approved
the transaction and has agreed to recommend May 2009 ‐ Acquisition ‐ Headline value:
to its stockholders that they tender their shares US$970m Johnson & Johnson will initiate a
pursuant to the tender offer. CV Therapeutics tender offer, through a new wholly‐owned
will become a wholly‐owned subsidiary of subsidiary, to purchase all outstanding shares of
Gilead. The transaction is valued at Cougar Biotechnology at $43 per share. The
approximately $1.4 billion. tender offer is conditioned on the tender of a
majority of the outstanding shares of Cougar
GLAXOSMITHKLINE AND BRAZIL ‐ $2.2B Biotechnology’s common stock. The closing is
Summary: In a move designed to help bolster conditioned on clearance under the Hart‐Scott‐
Brazil's emerging drug market (and GSK's Rodino Antitrust Improvements Act and other
emerging market plans), Glaxo inked a $2.2 customary closing conditions. The $970 million
billion deal to supply its Synflorix vaccine to estimated net value of the transaction is based
Brazil. But the GSK/Brazil 10‐year contract on Cougar Biotechnology’s 20.8 million shares
wasn't simply a vaccine supply deal. It included outstanding, net of estimated cash on hand at
a provision through which the price of Synflorix closing. The boards of directors of both Johnson
will fall from about $17 to a little more than $7 & Johnson and Cougar Biotechnology have
per dose over time, as well as a technology approved the transaction.
transfer component. Over the course of the
LUNDBECK ‐ OVATION
contract, GSK will pass on the knowledge and
expertise necessary to help Brazil make its own February 2009 ‐ Acquisition ‐ Headline value:
vaccine. Plus, Glaxo will invest €35 million ($51 $900m Definitive transaction agreement under
million) into an effort to develop a dengue fever which Lundbeck, through the wholly owned
vaccine, matching Brazil's own investment into subsidiary Lundbeck, Inc., will acquire Ovation
the effort. in an all cash transaction valuing Ovation at up
to USD 900 million or approximately DKK 5.2
GLAXOSMITHKLINE AND STIEFEL LABS ‐ $3.6B billion. The Supervisory Board at Lundbeck and
Summary: It was rumored in March that the Board of Directors of Ovation have
privately‐held Stiefel Laboratories, which unanimously approved the transaction.
specializes in dermatological products, was
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Pharma‐Bio M&A Deals 2009
MERCK AND SCHERING‐PLOUGH ‐ $41.1B giants was the largest corporate tie‐up since
2006. Pfizer CEO Jeff Kindler expressed great
Summary: The M&A fever continued in March
hope about the merger: "It will produce [a]
with Merck's acquisition of long‐time partner
distinct blend of diversification, flexibility, and
Schering‐Plough. The two had been working on
scale that positions the combo company for
cholesterol drugs Vytorin and Zetia, which have
success," he said at the time. However, the
caused controversy over questions of their
merger has resulted in layoffs (which could top
effectiveness. As with the Pfizer and Roche
19,500 when all is said and done). Plus, late last
deals, the merger has involved layoffs. Merck
month, Pfizer announced it is dropping about
CEO Richard Clark said that 15 percent of the
100 drug development programs from a
companies combined workforces would be cut.
pipeline swollen by the merger. The bulk of the
With a total workforce of 106,000, that adds up
remaining 500 programs focus on six key areas:
to about 16,000 workers.
Oncology, pain, inflammation, Alzheimer's
NOVARTIS AND ALCON ‐ $28.1B disease, psychoses and diabetes.
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Pharma‐Bio M&A Deals 2009
deals PTC has made for its GEMS technology. VARIAN ‐ AGILENT
The company also has a $1.2 billion agreements
July 2009 ‐ Acquisition ‐ Headline value:
with Pfizer, a $345 million pact with CV
US$1,500m Agilent will pay $52 cash per share
Therapeutics and a $212 million partnership
of common stock for Varian in a transaction
with Schering‐Plough.
that represents a premium of approximately
35% to Varian’s closing price on July 24, 2009.
SANOFI‐AVENTIS ‐ CHATTEM
Both Agilent’s and Varian’s Board of Directors
December 2009 ‐ Acquisition ‐ Headline value: have unanimously approved the all‐cash offer.
US$1,900m Definitive agreement under which
sanofi‐aventis is to acquire 100 percent of the WARNER CHILCOTT AND P&G ‐ $3.1B
outstanding shares of Chattem in a cash tender
Summary: Consumer products Proctor &
offer for $93.50 per share, or approximately
Gamble said in 2008 that it was planning to
$1.9 billion. The transaction will create the
offload its $2 billion pharmaceutical business
world's fifth‐largest consumer healthcare
unit, which featured drugs in the areas of
company measured by product revenues by
women's health, gastrointestinal problems and
combining Chattem's position as a leading U.S.
musculoskeletal disorders. P&G had already
consumer healthcare company with sanofi‐
stopped investing in drug development because
aventis' strong international presence in the
it wasn't very profitable. After months of
sector.
hunting, P&G found a buyer in Warner Chilcott,
which agreed to pay $3.1 billion for the
SANOFI‐AVENTIS AND MERCK ‐ $4B
business. Warner got a grab‐bag of assets,
Summary: Last summer, Sanofi‐Aventis bought including Asacol HD Delayed‐Release Tablets for
the rest of Merial, its animal health joint ulcerative colitis, Actonel for osteoporosis, and
venture with Merck, for $4 billion. And Sanofi the co‐promotion rights to Enablex for
negotiated an option to join forces again after overactive bladder, as well as P&G's
Merck and Schering‐Plough merge, combining prescription drug product pipeline and
Merial and Schering's animal health business manufacturing facilities in Puerto Rico and
Intervet. Under the option Sanofi would pay Germany. The good news for P&G employees
$9.25 billion to joint venture with Intervet, was that Warner elected to retain most of the
which would be owned equally by Merck and pharma unit's 2,300‐person staff.
Sanofi. "The combination would create a new
leader in this $19 billion global animal health WATSON ‐ ARROW GROUP
market, supporting our vision of a global
June 2009 ‐ Acquisition ‐ Headline value:
diversified healthcare leader." Sanofi CEO
$1,750m Definitive agreement to acquire
Christopher Viehbacher said at the time.
privately held Arrow Group for $1.75 billion in
cash and stock. The combination of Watson and
TPG ‐ IMS HEALTH
Arrow will result in a global pharmaceutical
November 2009 ‐ Acquisition ‐ Headline value: company with over $3 billion in revenue,
$5,200m IMS Health has entered into a commercial operations in over 20 countries,
definitive agreement to be acquired by and a robust product portfolio and pipeline.
investment funds managed by TPG Capital and Watson expects the transaction to close in the
the CPP Investment Board in a transaction with second half of 2009, and be accretive to cash
a total value of $5.2 billion, including the earnings per share in 2010 before synergies.
assumption of debt.
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Pharma‐Bio M&A Deals 2009
SOURCES:
‐ CURRENTPARTNERING:
http://www.currentpartnering.com/scorecard/manda2009
‐ NATURE REVIEWS DRUG DISCOVERY:
http://www.nature.com/nrd/journal/v9/n2/full/nrd3114.html
‐ FIERCEBIOTECH:
http://www.fiercebiotech.com/special‐reports/top‐10‐biopharma‐deals‐2009
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