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Sanofi makes $9.3bn unsolicited bid for Medivation

Hopes to boost oncology business with fast-growing prostate cancer drug Xtandi
Sanofi

Earlier rumours of Sanofi's interest in Medivation were confirmed today after the company made an all-cash offer to buy the US biotech for around $9.3bn.

The French pharma group has swooped in with a $52.50 per share offer to buy Medivation, which it says is a 50% premium on the firm's average share price over the last two months, in an attempt to bolster its oncology business.

Earlier this month there were suggestions that Sanofi was interested in taking over Medivation to gain access to its fast-growing prostate cancer drug Xtandi (enzalutamide) and pipeline, and was prepared to mount a hostile bid if its advances were rebuffed.

A letter from Sanofi chief executive Olivier Brandicourt to his counterpart at Medivation David Hung notes that the US firm has declined to enter into negotiations since first contact was made in March, forcing Sanofi to make its offer public.

"We have set a clear strategic roadmap for 2020 and oncology plays an important role as part of that plan," says the letter.

"As we aim to further develop our capabilities in this important area, we believe that Medivation represents a very strong fit and, together with our own clinical pipeline and existing infrastructure, will play an important role in our long-term strategy in oncology."

Partnered with Astellas, Xtandi is currently Medivation's only marketed product and made $1.9bn in sales last year in its first indication of advanced castration-resistant prostate cancer. Medivation is also developing the drug for liver and breast cancer and analysts have predicted that it could eventually become $3bn-$6bn product.

Sanofi has been making a concerted effort to expand in cancer since 2009, but is considered to have underperformed in terms of bringing new drugs through development.

Adding Medivation would give it a growth product - sales rose 80% last year - as well as PARP inhibitor talazoparib (MDV3800) in phase III for breast cancer and immuno-oncology candidate pidilizumab (MDV9300) in phase II for diffuse large B-cell lymphoma (DLCBL).

Sanofi's mid- to late-stage cancer pipeline is focused mainly on follow-up indications for prostate cancer therapy Jevtana (cabazitaxel) and isatuximab, an anti-CD38 antibody in phase II trials involving multiple myeloma patients.

Article by
Phil Taylor

28th April 2016

From: Sales

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