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Swedish Orphan Rises on Takeover Bid Amid Boom in Drug Deals

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Swedish Orphan Biovitrum AB, a maker of treatments for rare diseases, rose as much as 24 percent after saying it’s reviewing a preliminary takeover offer amid a boom in pharmaceutical deals.

The drugmaker, better known as Sobi, has held on-and-off again talks with potential buyers since last year as its stock trades at an all-time high, Bloomberg reported two days ago, citing people familiar with the matter.

Swedish Orphan, whose biggest shareholder is Investor AB, can’t be sure a final offer will be made, or that the terms will be attractive, the Stockholm-based company said in a statement on Monday.

Sobi could attract interest from large companies including Pfizer Inc., which has a partnership with the Swedish firm, said the people, who asked not to be identified because deliberations are private. Biogen Inc., which also works with Sobi, could look at parts or all as well, they said.

Sobi’s stock traded at 134.80 kroner, up 21 percent, as of 9:23 a.m. in Stockholm, giving the drugmaker a market value of about 37.1 billion Swedish krona ($4.3 billion). Investor AB was little changed.

Sobi has been working with Goldman Sachs Group Inc. for some time as it prepares for potential approaches, the people said.

Representatives of Pfizer, Biogen, Sobi, Investor AB, and Goldman Sachs declined to comment beyond the statement published on Monday.

“The board confirms that it has received a preliminary and conditional non-binding proposal in relation to a possible offer for all shares,” Sobi said in the statement.

Investor AB, the investment vehicle controlled by Sweden’s billionaire Wallenberg family, owns about 40 percent of Sobi’s stock, according to Bloomberg data.

Deals Activity

Sobi manufactures drugs including arthritis treatment Kineret and Orfadin, for a rare metabolic disorder. It has an existing partnership with Pfizer to manufacture ReFacto, a hemophilia drug, and is working with Biogen to develop other blood clotting treatments.

This year has seen record activity for mergers and acquisitions in the pharmaceutical industry. Mylan NV this week went forward with a hostile $31.2 billion bid for fellow drugmaker Perrigo Co., opting to take its offer directly to shareholders rather than accept a separate takeover proposal from Teva Pharmaceutical Industries Ltd.

Pfizer has been on the hunt for acquisitions to build its drug pipeline since failing in its pursuit of the U.K.’s AstraZeneca Plc last year. Chief Executive Officer Ian Read said earlier this year that the company, based in New York, was continuing to look at opportunities even after agreeing to buy Hospira Inc. for $17 billion.

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