Biogen Seen as Takeover Target After Friday’s Stock PlummetDoni Bloomfield
Shares of Biogen Inc. jumped Monday after analysts speculated the biotechnology company could become the industry’s next takeover target.
Biogen rose as much as 8.3 percent. The gain was one trading day after the company’s worst share performance in almost seven years, when the stock fell 22 percent after the drugmaker cut its 2015 sales forecast.
That could make Biogen vulnerable, said analysts.
“Historically, big companies have shown a heightened sense of smell when blood is in the water,” Cory Kasimov, an analyst with JPMorgan Chase & Co., said in a note to investors. “If a mega-cap company comes to the conclusion that Biogen’s pipeline of potential needle-moving assets comes cheap” they may make a move.
Biogen’s biggest product is the multiple sclerosis medicine Tecfidera. Last week the company reported sales of the drug, and two other MS treatments -- Avonex and Tysabri -- that fell short of analysts’ estimates. The three drugs made up 81 percent of Biogen’s revenue last year.
Kate Niazi-Sai, a Biogen spokeswoman, declined to comment on whether the company could be a target.
The shares gave back much of their gains later in the day. They were up 2.3 percent to $307.03 at 1:13 p.m. in New York.
Drugmakers have announced a record $220.7 billion worth of mergers and acquisitions so far this year, according to data compiled by Bloomberg.
Biogen could be a target for Allergan Plc, which announced a $40.5 billion deal Monday to sell its generic drugs unit to Teva Pharmaceutical Industries Ltd. Umer Raffat, an analyst with Evercore-ISI, said that he had polled clients and found that Biogen was among the top companies investors wanted Allergan to pursue.
Cash from the Teva deal may be used on a large purchase within 18 months, Allergan Chief Executive Officer Brent Saunders said on a call with investors Monday.
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