Replies to post #63611 on Biotech Values

[oldberkeley]

RE: Recent Biotech Buyouts at a Large Premium

Dew- I've been thinking about this lately re GTCB.

I posted a comment on that board about Wednesday's 400% premium to market buyout of MEDE. One poster countered that while this number seemed impressive, the precipitous decline of MEDE's share price up to that point had to be taken into account. I think there's some validity to this.

It would be a time-consuming exercise, but I wonder if a more accurate assessment of a deal would be to compare the buyout price to a long-term moving average of a stock, or some similar rubric that considered the bigger picture.

Your thoughts? TIA.

[oldberkeley]

>Recent Biotech Buyouts at a Large Premium<

Dew-

I'd certainly like to see a better numbers person than I do this, but...

While KOSN's buyout price was a 233% premium to the previous day's close, it was a 57% premium to the 200 day MA.

While COLY's buyout price was a 167% premium to the previous day's close, it was a 33% premium to the 200 day MA.

I stopped there (too much darn work, I have beer to drink! :-) ) but I suspect that with some exceptions, one would find the same pattern.

I'm certainly no statistician, but this might support the thesis that many of these buyout premiums are not quite as dramatic as they appear.

[DewDiligence]

Yet another buyout with a big (136%) premium:

http://biz.yahoo.com/prnews/080623/clm050a.html

>>
Barrier Therapeutics to Merge Into Stiefel Laboratories

Monday June 23, 9:00 am ET

CORAL GABLES, Fla., June 23 /PRNewswire/ -- Stiefel Laboratories Inc., the world's largest independent pharmaceutical company specializing in dermatology, today announced it has signed a definitive merger agreement, pursuant to which Stiefel Laboratories will acquire Barrier Therapeutics, Inc. ("Barrier Therapeutics") (Nasdaq: BTRX ), through a two-step transaction, a tender offer followed by a merger of Barrier Therapeutics into a wholly-owned subsidiary of Stiefel Laboratories, at a price of $4.15 in cash, per share of Barrier Therapeutics' common stock. The transaction, valued at approximately $148 million, is subject to the valid tender of a majority of Barrier Therapeutics' fully diluted common stock, regulatory approvals and other customary conditions, but is not subject to any financing conditions. The price of $4.15 per share of Barrier Therapeutics' common stock represents a premium of approximately 73% to Barrier Therapeutics' average closing price for the past 30 days. The parties expect the transaction to close by the end of the third quarter of 2008.

The Board of Directors of Barrier Therapeutics has approved the definitive merger agreement and the transactions contemplated thereby and has resolved to recommend that Barrier Therapeutics' stockholders tender their shares in connection with the tender offer contemplated by the definitive merger agreement.

This acquisition underscores Stiefel Laboratories' continuing efforts to search for and develop premium-quality, innovative dermatology products and to focus on providing a superior customer experience in global therapeutic and aesthetic dermatology.

"This acquisition demonstrates our continued commitment to advancing the field of therapeutic dermatology," said Charles W. Stiefel, chairman and chief executive officer of Stiefel Laboratories. "We are very impressed with Barrier Therapeutics' innovative products and pipeline. This strategic move will further expand our oral and topical product portfolio in development and increase our sales of novel treatments for skin conditions."

Barrier Therapeutics currently markets three pharmaceutical products. In addition to these marketed products, the company has other product candidates in various stages of development for the treatment of a range of dermatological conditions.

"We are very proud of the accomplishments of the entire Barrier Therapeutics team since we were founded in 2002, and we are pleased that Stiefel Laboratories recognizes the value that we have created," said Al Altomari, chief executive officer of Barrier Therapeutics. "We believe that this transaction provides substantial value to our stockholders. We believe that Barrier Therapeutics' product portfolio and innovative R&D pipeline candidates are among the greatest assets in dermatology and will strengthen Stiefel Laboratories' position in the global dermatology market."

J.P. Morgan Securities Inc. is acting as exclusive financial advisor to Barrier Therapeutics, and Morgan, Lewis & Bockius, LLP is acting as Barrier Therapeutics' legal counsel in the transaction. Deutsche Bank Securities Inc. is acting as exclusive financial advisor to Stiefel Laboratories, and Willkie Farr & Gallagher LLP is acting as Stiefel Laboratories' legal counsel in the transaction.

About Barrier Therapeutics

Barrier Therapeutics is a pharmaceutical company focused on the development and commercialization of products in the field of dermatology. Barrier Therapeutics currently markets three pharmaceutical products in the United States: Xolegel® (ketoconazole, USP) Gel, 2%, for seborrheic dermatitis; Vusion® (0.25% miconazole nitrate, 15% zinc oxide, 81.35% white petrolatum) Ointment, for diaper dermatitis complicated by documented candidiasis; and Solage® (mequinol 2.0%, tretinoin 0.01%) Topical Solution, for solar lentigines. Barrier Therapeutics has other product candidates in various stages of clinical development for the treatment of a range of dermatological conditions, including onychomycosis, psoriasis, acne, skin allergies, and acute fungal infections. The company is headquartered in Princeton, New Jersey and has a wholly-owned subsidiary in Geel, Belgium. More information about Barrier Therapeutics can be found on its corporate website at: www.barriertherapeutics.com .

About Stiefel Laboratories, Inc.

Founded in 1847, Stiefel Laboratories (a privately held company) is the world's largest independent pharmaceutical company specializing in dermatology. The company manufactures and markets a variety of prescription and non-prescription dermatological products. Some of the newest and best-known brands include Duac® Topical Gel (clindamycin, 1% - benzoyl peroxide, 5%) available in the Duac® Care System (CS); Evoclin® (clindamycin phosphate) Foam, 1%; Luxiq® (betamethasone valerate) Foam, 0.12%; MimyX® Cream; Olux® (clobetasol propionate) Foam, 0.05% and Olux-E® (clobetasol propionate) Foam, 0.05% also available in the Olux® / Olux-E® COMPLETE PACK; Soriatane® (acitretin) Capsules available in the Soriatane® CK CONVENIENCE KIT; Verdeso® (desonide) Foam, 0.05%; Brevoxyl®-4 Creamy Wash (benzoyl peroxide 4%) and Brevoxyl®-8 Creamy Wash (benzoyl peroxide 8%) packaged in the Brevoxyl® Acne Wash Kit; Extina® (ketoconazole) Foam, 2%; Oilatum® Cleansing Bar; Physiogel® Cream; Stieprox® (ciclopirox olamine) Shampoo; REVALESKIN(TM) Skin Care Products; and Sarna® Lotion. Its wholly-owned global network is comprised of more than 30 subsidiaries, manufacturing plants in six countries, research and development facilities on four continents, and products marketed in more than 100 countries around the world.

Stiefel Laboratories supplements its R&D efforts by seeking strategic partnerships and acquisitions around the world. To learn more about Stiefel Laboratories, Inc. visit www.stiefel.com.
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[DewDiligence]

Recent Biotech Buyouts at a Large Premium

[Added BTRX buyout.]

 
 Acquired         Premium    Deal         iHub  
 Company  Buyer   to Market  Value  Date  Reference  
 KOSN     BMY       233%     $190M  5/08  #msg-29647147 
 COLY     PFE       167%     $165M 11/07  #msg-24600805 
 IOMI     Intercell 147%     $190M  5/08  #msg-29232165  
 BTRX     Stiefel   136%     $150M  6/08  #msg-30201906 
 TRCA     Ipsen     104%     $660M  6/08  #msg-29795183  
 SIRT     GSK        85%     $620M  4/08  #msg-28705020  
 MLNM     Takeda     53%     $8.8B  4/08  #msg-28365383

Let’s talk biotech!
“The efficient-market hypothesis may be
the foremost piece of B.S. ever promulgated
in any area of human knowledge!”