Thursday, September 19, 2013 8:46:34 AM
By Trista Kelley & Meg Tirrell - Sep 19, 2013 8:18 AM ET
BioMarin Pharmaceutical Inc. (BMRN) gained after DealReporter said Roche Holding AG (ROG) is lining up $15 billion in debt financing for an acquisition of the maker of drugs to treat rare diseases.
Roche may have to pay $95 to $105 a share for the Novato, California-based company, DealReporter said, citing people familiar with the situation. The lower end of the range would be a 23 percent premium to BioMarin’s closing level yesterday of $77.49, and would value the company at about $13.5 billion.
Enlarge image Roche Holding AG Reported to Seek Financing for BioMarin
A logo sits above office windows outside the headquarters of Roche AG in Basel. Photographer: Gianluca Colla/Bloomberg
A takeover would give Roche a company that drew $500.7 million in 2012 revenue from medicines for diseases including mucopolysaccharidosis VI, or MPS VI, a rare, life-threatening lysosomal storage disorder. BioMarin also has a slate of experimental treatments for other rare diseases and cancer, and analysts expect its revenue to grow by at least 20 percent in 2014 and 2015.
“BioMarin is a very interesting company, great products, excellent pipeline in good markets, and a focus on orphan drugs,” said Connie Schuemann, who helps manage about $36 billion at Raiffeisen Capital Management in Vienna. “But it comes at a high price.”
BioMarin climbed 9.5 percent to $84.88 at 7:57 a.m. New York time in trading before U.S. markets opened.
Roche, the world’s biggest maker of cancer drugs, climbed less than 1 percent to 239.10 Swiss francs. Silvia Dobry, a spokeswoman for the Basel, Switzerland-based company, declined to comment on the DealReporter article. BioMarin spokeswoman Debra Charlesworth didn’t immediately respond messages left before business hours.
$5 Billion
UBS AG (UBSN) is leading the financing and has indicated it will lend $5 billion to Roche for the takeover, DealReporter said. Citigroup Inc. is advising Roche on the potential sale while JPMorgan Chase & Co. (JPM) and Goldman Sachs Group Inc. may assist in financing, DealReporter said.
Roche considered a bid for Alexion Pharmaceuticals Inc. (ALXN), another maker of medicines for rare diseases, people with knowledge of the matter said in July. Alexion engaged Goldman as an adviser to prepare for a possible bid from Roche, the people said at the time.
Companies like BioMarin and Alexion develop medicines for as few as 5,000 to 10,000 patients worldwide, and charge as much as $400,000 a year per patient.
Contradict History
A bid for BioMarin would contradict Roche’s history of “financially disciplined” acquisition negotiations, said Andrew Weiss, an analyst at Bank Vontobel AG in Zurich.
If the BioMarin report is true, “this would be a waste of money” at 40 percent more expensive than Alexion, as measured by enterprise value to sales, said Weiss. “Orphans are not a strategic imperative for Roche. They look for things that make sense and if something happens to be an orphan, so be it.”
Medicines for such small patient populations, known as orphan drugs, get exclusive marketing rights as an incentive for their development in the U.S. and Europe, while the small patient populations mean fewer participants are needed for clinical trials. They’ve drawn the interest of large pharmaceutical companies looking to fend off a drop in sales as patents on blockbuster drugs expire.
Recent BMRN News
- BioMarin to Present Data Underscoring Sustained Positive Impact of VOXZOGO® (vosoritide) on Health-Related Quality of Life, Growth and Maintenance of Bone Strength in Children with Achondroplasia at 2024 International Skeletal Dysplasia Society Meeting • PR Newswire (US) • 09/18/2024 12:00:00 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 09/17/2024 09:54:07 PM
- BioMarin Holds Investor Day; Provides New Corporate Strategy and Introduces 2027 Financial Guidance • PR Newswire (US) • 09/04/2024 05:00:00 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 09/04/2024 04:52:34 PM
- BioMarin to Host Investor Day Today at 10:30 a.m. Eastern Time • PR Newswire (US) • 09/04/2024 11:30:00 AM
- BioMarin to Present at the 22nd Annual Morgan Stanley Global Healthcare Conference on Thursday, September 5 at 7:45 AM PT / 10:45 AM ET in New York, NY • PR Newswire (US) • 08/29/2024 12:00:00 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 08/28/2024 09:02:40 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 08/22/2024 09:00:30 PM
- BioMarin Announces New R&D and Business Development Leadership • PR Newswire (US) • 08/21/2024 12:30:00 PM
- BioMarin to Host 2024 Investor Day on September 4th in New York • PR Newswire (US) • 08/19/2024 01:00:00 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 08/15/2024 07:57:07 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 08/13/2024 03:48:00 PM
- Form 10-Q - Quarterly report [Sections 13 or 15(d)] • Edgar (US Regulatory) • 08/05/2024 08:35:15 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 08/05/2024 08:05:28 PM
- BioMarin Announces 20% Y/Y Total Revenue Growth in the Second Quarter and Increase in Full-year 2024 Guidance • PR Newswire (US) • 08/05/2024 08:03:00 PM
- BioMarin Announces Updated Strategy for ROCTAVIAN® to Focus on U.S., Germany and Italy • PR Newswire (US) • 08/05/2024 08:01:00 PM
- U.S. Food and Drug Administration Approves BioMarin's BRINEURA® (cerliponase alfa) for Children Under 3 Years with CLN2 Disease • PR Newswire (US) • 07/24/2024 08:05:00 PM
- BioMarin to Host Second Quarter 2024 Financial Results Conference Call and Webcast on Monday, August 5, 2024, at 4:30pm ET • PR Newswire (US) • 07/23/2024 12:00:00 PM
- BioMarin to Present Data Highlighting Significant Impact of VOXZOGO® (vosoritide) in Bone Health and Health-Related Quality of Life in Achondroplasia at 2024 International Conference on Children's Bone Health • PR Newswire (US) • 06/17/2024 12:30:00 PM
- KKR, CrowdStrike Holdings and GoDaddy Set to Join S&P 500; Others to Join S&P MidCap 400 and S&P SmallCap 600 • PR Newswire (US) • 06/07/2024 10:09:00 PM
- BioMarin Presents New Phase 3, Four-Year Data Underscoring Long-Term Safety and Efficacy of ROCTAVIAN® (valoctocogene roxaparvovec-rvox) at International Society on Thrombosis and Haemostasis 2024 Congress • PR Newswire (US) • 06/07/2024 01:00:00 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 06/04/2024 11:28:12 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 06/04/2024 02:18:38 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/31/2024 10:28:05 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 05/31/2024 02:49:42 PM
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