Medivation announced Tuesday that its board has rejected Sanofi's latest unsolicited takeover proposal as the offer was "not in the best interests of the company." The new offer of $58 a share in cash is higher than Sanofi's initial bid of $52.50 per share, or roughly $9.3 billion, which Medivation dismissed in April, and also included a contingent value right up to $3 per share tied to potential sales of the experimental PARP inhibitor talazoparib.
Separately, Medivation indicated that it has entered into confidentiality agreements with a "number of parties that have expressed interest in exploring a potential transaction," including Sanofi, which also agreed to terminate its consent solicitation. The US-based company added it soon expects to provide each party the opportunity to review non-public information and meet with its management. Besides specifying Sanofi, Medivation did not disclose the names of the other parties, although people familiar with the matter said it signed confidentiality agreements regarding a possible sale with Pfizer and Celgene.
Kim Blickenstaff, chairman of Medivation's board of directors, said the biopharmaceutical company "has significant scarcity value as one of the only profitable, commercial-stage oncology companies," adding that the board is "committed to objectively considering all avenues." Further, he suggested that the decision to enter into the agreements will "allow interested parties to fully understand the significant value of our Xtandi (enzalutamide) franchise and the enormous potential of our pipeline, including talazoparib." Analysts project that Medivation's prostate-cancer treatment Xtandi will generate $1.3 billion in sales by 2020.
Meanwhile, Sanofi CEO Olivier Brandicourt said the French drugmaker was "pleased to have the opportunity to engage with Medivation," which it had recently urged to enter merger talks or face a potential hostile bid. He added that the increased takeover offer was "driven by our in-depth analysis of the benefits and value creation potential of a combination," which he suggested would "provide Medivation and its employees with an outstanding platform to further grow its oncology franchise."
For related analysis, read ViewPoints: Sanofi edging towards Medivation – is there a better fit?
To read more Top Story articles, click here.