Amylin Pharmaceuticals Inc. is preparing for a second round of bids after attracting offers that value the diabetes drugmaker at $25 to $29 a share, said people with knowledge of the process.
AstraZeneca Plc joined Sanofi, Merck & Co. and Bristol-Myers Squibb Co. in making first-round proposals, said the people, who declined to be identified as talks are private. Pfizer Inc., which made a bid on the lower end of the range, is dropping out of the process, said one of the people.
The suitors gave ranges for their bids, with some offering $25 to $28 a share and others $26 to $29, said one person. Such bids would value Amylin, whose treatments include the diabetes drugs Bydureon and Byetta, at $4.1 billion to $4.7 billion, based on the shares outstanding as of April 26. San Diego-based Amylin is asking suitors to submit revised offers by the end of June, with a sale likely in July, said two of these people.
AstraZeneca may have the greatest need, said Michael King, an analyst at Rodman & Renshaw in New York, in a telephone interview today. “They seem to be struggling. I think they’re under a lot of pressure to do something to grow sales or they themselves could be acquired.”
David Brennan retired June 1 as chief executive officer. The London-based company’s Seroquel lost U.S. patent protection in March. Analysts expect the antipsychotic drug’s sales to drop to $3.27 billion this year from $5.82 billion last year, according to data compiled by Bloomberg.
Valuing Amylin at $25 to $29 a share is reasonable, said King and Mark Schoenebaum, an analyst with ISI Group in New York. King also said $29 is “pretty pricey” and he expects the final value to be toward the lower end of the range.
Amylin rose 2.7 percent to $27.35 at the close in New York. The stock gained 78 percent through today since March 27, the day before Bloomberg News reported that Amylin had rejected an earlier bid from Bristol-Myers.
Bidders are receiving Amylin senior-management presentations and confidential information regarding correspondence the company has had with the U.S. Food and Drug Administration on certain drugs, said one of these people.
Representatives at Amylin, Merck, Bristol-Myers, AstraZeneca, Sanofi and Pfizer declined to comment.
Japanese drugmaker Takeda Pharmaceutical Co. didn’t put in a first-round bid, said another person familiar with the matter. The company is still tracking the sales process, this person said. Elissa Johnsen, a spokeswoman for Takeda, declined to comment.
Amylin began seeking suitors after rejecting the $22-a-share offer from New York-based Bristol-Myers in February, people familiar with the matter said earlier this year. The company may generate as much as $1.5 billion in annual sales from the diabetes treatments Byetta and Bydureon, according to Phil Nadeau, an analyst with Cowen & Co. in New York.
Revenue at Amylin surpassed $650 million in 2012 and may rise about 5 percent in 2012, analyst estimates compiled by Bloomberg show. About 346 million people in the world have diabetes, and the number of deaths from the chronic disease may double from 2005 to 2030, according to the World Health Organization.