Amgen Inc., the world’s largest biotechnology company, is considering a takeover offer for Actelion Ltd. to gain new medicines for rare diseases, and may approach the Swiss drugmaker as early as this week, said two people with knowledge of the matter.
Actelion and its advisers recently learned of a potential bid from Amgen, said one of the people, who declined to be named because the process is private. As a defensive measure, Chief Executive Officer Jean-Paul Clozel has discussed asking Roche Holding AG, Johnson & Johnson and Bristol-Myers Squibb Co. to consider taking a minority stake, they said. Clozel, who has said he wants the company he founded to stay independent, has contacted Roche, one person said. Actelion rose 9.1 percent in Swiss trading.
Actelion, the world’s biggest maker of pulmonary arterial hypertension drugs, may generate $2.1 billion by 2015 from Tracleer, as well as added sales from two experimental drugs in final-stage tests for the rare condition, which afflicts no more than 200,000 people worldwide, said Olav Zilian, an analyst with Helvea AG, in a telephone interview yesterday.
“Amgen has talked about geographic expansion and Actelion seems to have a strong business in Europe and in the specialty drug market, selling drugs for rare diseases at premium prices,” said Eric Schmidt, an analyst with Cowen & Co. in New York, in a telephone interview yesterday.
David Polk, a spokesman for Amgen, declined to comment on the company’s potential interest in Actelion. “As part of its ordinary course of business, the company is in regular dialogue with other industry participants,” Actelion said in a statement today. Roland Haefeli, a spokesman for Actelion, didn’t return a call and e-mail seeking comment.
Jeffrey Leebaw, a spokesman for Johnson & Johnson, and Jennifer Fron Mauer, a spokeswoman for Bristol-Myers, also declined to comment. “As usual we would not comment on such market rumors,” Roche Chief Executive Officer Severin Schwan said in an interview today. Clozel, a former Roche scientist, founded Actelion in 1997 to develop medicines that Roche had given up on.
Amgen, based in Thousand Oaks, California, hasn’t made a final decision and a formal offer may not emerge, one of the people said.
Actelion rose 4.55 Swiss francs to 54.60 francs at the 5:30 p.m. close of trading in Zurich, the biggest gain since Oct. 8. Amgen declined 16 cents to close at $53.87 in Nasdaq Stock Market trading.
Actelion, based in Allschwil, Switzerland, has a market value of 7.1 billion francs ($7.1 billion). The company’s board formed a committee to consider strategic alternatives this year and hired Moelis & Co. for advice after a share-price decline left the company vulnerable to a takeover. Credit Suisse Group AG is advising the company, while Lazard Ltd. is working with Amgen.
“Actelion is clearly trying to pull a fast one by negotiating a blocking position with Roche,” said Guy Wyser-Pratte, head of the New York-based Wyser-Pratte Management Co., an Actelion investor. Actelion could be worth 70 Swiss francs a share in an acquisition, he said.
Amgen may use acquisitions to expand outside the U.S., and to gain products in areas beyond its current focus in cancer and immunology, Roger Perlmutter, Amgen’s executive vice president for research and development, said in a Nov. 15 telephone interview.
“When we look out at the world, we would like to expand our programs to other countries where we’re relatively narrow,” Perlmutter said. “A company that has an effective R&D organization in an area where we have not been active -- such as cardiology, neuroscience or infectious disease -- also might make sense.”
Amgen had about $17 billion in cash and short-term investments as of Sept. 30. Over the past five years, Amgen has announced seven purchases with an average value of $561.4 million and an average premium of 32 percent. Its biggest deal was the $2.1 billion purchase of Abgenix Inc. in 2005, which gave Amgen the cancer drug Vectibix.
Amgen revenue fell last year as its top-seller, Enbrel for arthritis, faced new competition and its anemia drugs, Aranesp and Epogen, dropped for the fourth straight year after being linked to heart attacks. Actelion could provide steady revenue growth, Zilian said.
“One upside with Actelion is that you could continue to grow the pulmonary arterial hypertension market because it’s still only a minority of people that are diagnosed and treated,” Zilian said. “For a company that wants to be present in the market for lung disease, the specialist sales force is really important and you’d already have that with Actelion.”
Actelion got about 85 percent of its revenue last year from Tracleer, which has dominated the market for pulmonary arterial hypertension, or PAH, since it won approval in 2001. The medicine generated 1.51 billion francs in sales in 2009. PAH is a potentially fatal condition that causes high blood pressure in the artery moving blood from the heart to the lungs.
Tracleer works by blocking the hormone endothelin, which is elevated in the plasma and lung tissue of people with pulmonary hypertension. Endothelin is a potent blood vessel constrictor that plays a role in other illnesses including kidney disease and cancer.
Actelion’s stock fell this year after disappointing clinical trials. In March, the company’s efforts to expand use of Tracleer suffered a setback when the drug didn’t meet the goal of a clinical test on patients with a rare lung ailment. The drugmaker also said Sept. 27 its clazosentan medicine failed to meet the main goal of a study in patients who had suffered from bleeding in the brain.
Actelion also has four compounds in the third and final stage of tests generally needed for regulatory approval. Two of those experimental medicines, macitentan and selexipag, are designed to treat PAH.
“The attraction of buying Actelion would be that you’d have the dominant player in PAH and, if you believe that macitentan will come good, you’d see the longevity of that franchise substantially increased,” Samir Devani, an analyst at Nomura Code in London, said a telephone interview yesterday.
Johnson & Johnson, of New Brunswick, New Jersey, in April 2009 won U.S. approval of Simponi, a rheumatoid arthritis treatment injected less frequently than Enbrel.
Sales of Amgen’s anemia drugs Aranesp and Epogen fell 21 percent to $5.2 billion last year from a high of $6.6 billion in 2006 after cardiovascular risks began to emerge in 2007.