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
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 05/10/2024 02:11:12 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 05/09/2024 02:54:13 PM
- BioMarin to Present at the BofA Securities 2024 Health Care Conference on Wednesday, May 15 at 10:00am PT / 1:00pm ET, in Las Vegas, NV • PR Newswire (US) • 05/08/2024 12:00:00 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/07/2024 09:58:28 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/06/2024 08:45:20 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/06/2024 08:40:49 PM
- New Data for BioMarin's VOXZOGO® (vosoritide) for Multiple Growth-Related Conditions in Children Presented at Pediatric Endocrine Society (PES) Annual Meeting • PR Newswire (US) • 05/04/2024 08:00:00 PM
- BioMarin Reports Record Financial Results for the First Quarter 2024 • PR Newswire (US) • 04/24/2024 08:03:00 PM
- BioMarin to Host First Quarter 2024 Financial Results Conference Call and Webcast on Wednesday, April 24, 2024, at 4:30pm ET • PR Newswire (US) • 04/10/2024 12:00:00 PM
- New Data to be Presented for BioMarin's VOXZOGO® (vosoritide) in Children with Hypochondroplasia and Achondroplasia at the American College of Medical Genetics and Genomics (ACMG) Annual Clinical Genetics Meeting • PR Newswire (US) • 03/12/2024 12:30:00 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/07/2024 11:54:17 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/07/2024 10:35:37 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/07/2024 10:32:40 PM
- BioMarin Announces Appointment of Cristin Hubbard as Chief Commercial Officer • PR Newswire (US) • 03/07/2024 01:30:00 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 03/06/2024 05:04:50 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 03/05/2024 09:17:10 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 03/05/2024 07:41:36 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 03/05/2024 05:04:02 PM
- BioMarin Scheduled to Participate in March Investor Conferences • PR Newswire (US) • 03/01/2024 02:00:00 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 02/29/2024 10:18:55 PM
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- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 02/29/2024 10:10:41 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 02/29/2024 10:05:21 PM
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