Biogen Idec up for sale after Icahn offer
Our Corporate Bureau
13 October 2007
Biogen said its board of directors has authorised managers to explore the options for the company, to maximise shareholder value.
Biogen, best-known for the leading multiple sclerosis drug Avonex, which is its primary revenue driver, is one of biotech's largest firms in terms of sales and market capitalisation.
Cambridge, Massachusetts-based Biogen said it is still confident in the business outlook, which it believes will also create attractive value for shareholders. Biogen said it expected compound annual revenue-growth rate of 15 per cent.
A “potential strategic interest on the part of major pharmaceutical companies might result in superior value,'' Biogen, the world's largest maker of multiple sclerosis drugs, said in a statement today.
The US Federal Trade Commission cleared Icahn to buy into Biogen In August, according to a message posted on the agency's website. Icahn usually buys into companies he deems undervalued and presses for changes or a sale.
He bought shares in MedImmune Inc. before helping to force a sale of the biotech company in April to AstraZeneca Plc for $15 billion.
Icahn is said to have acquired 2.74 million shares, or nearly one per cent, of Biogen In August.
Biogen shares rose $12.47, or 18 per cent on the New York market yesterday, the biggest since a 20 per cent increase on 18 February 2004 on the Nasdaq Stock Market.
Biogen is currently valued at 30 times profit, down from 48 times before February 2005, when its MS treatment was temporarily withdrawn from the market because of a link to a rare brain infection. Regulators allowed Biogen and its partner Elan Corp. to resume selling the drug, Tysabri, last year because of its effectiveness.
Biogen projected compound annual growth of 15 per cent for revenue through 2010 and 20 per cent for non-GAAP earnings per share.
The company has hired Goldman, Sachs & Co. and Merrill Lynch & Co. as advisers.
Biogen Idec has over 20 products currently in clinical development addressing a variety of key medical needs.
The company also has capabilities and world-class capacity for protein manufacturing. The company is among the few biotechnology companies that has three licensed and dedicated biological bulk-manufacturing facilities, including its large-scale manufacturing plant in Research Triangle Park, NC, which is one of the world's largest cell culture facilities. An additional large-scale manufacturing plant is under construction in Hillerød, Denmark. Biogen Idec has sufficient commercial manufacturing capacity for its own pipeline, as well as potential partners' products.
Biogen Idec was formed in 2003 from the merger of two of the world's leading biotechnology companies, Biogen Inc, founded in 1978, and IDEC Pharmaceutical Corporaition, founded in 1985.
The company maintains research centres of excellence in San Diego, CA and Cambridge, MA. Biogen Idec has additional offices in Canada, Australia, Japan and throughout Europe, including international headquarters in Zug, Switzerland and operates a global distribution network, which covers over 70 countries. The company currently employs approximately 3,900 people worldwide.