Medivation Said to Have Rebuffed Sanofi Takeover Approachby , , and
Drugmaker Sanofi hasn't ruled out hostile bid for U.S. company
Other drugmakers may try to buy the California-based business
Medivation Inc. rebuffed a recent takeover approach from French drugmaker Sanofi, which is pursuing the U.S. company to expand its cancer treatment business, according to people familiar with the matter.
Sanofi is working with advisers on a potential offer and hasn’t ruled out making a hostile bid, the people said, asking not to be identified because the deliberations are private. Medivation hired defense advisers after it received preliminary interest from potential buyers, people familiar with the matter said last month.
Medivation, which focuses on treatments for hard-to-cure cancers, is seeking a higher price than initial proposals have indicated, the people said. Other suitors are also considering making an offer, they said.
Shares in Medivation rose 10 percent to $50.23 at 9:32 a.m. in New York, valuing the company at about $8.2 billion. Sanofi was up 1 percent 75.06 euros.
Representatives for Medivation and Sanofi declined to comment.
Roche Holding AG, the world’s largest producer of cancer drugs, and AstraZeneca Plc are expanding their oncology portfolios. Like Medivation, the pharmaceutical companies are developing so-called immuno-oncology treatments that harness a patient’s immune system to target tumors.
Hartaj Singh, an analyst at BTIG, compared Medivation to Pharmacyclics Inc. in a note to clients on April 4. Pharmacyclics, another biotechnology company focused on cancer treatments, was acquired by AbbVie Inc. for $21 billion last May.
“Both companies have an approved product that is best in class, torrid sales growth, future indication expansion potential,” and lean operating expenses, wrote Singh.
The company recently won the backing of the European Medicines Agency’s Committee for Medicinal Products for Human Use for its Xtandi drug, a treatment for prostate cancer it sells in collaboration with Astellas Pharma Inc.
The recommendation will allow San Francisco-based Medivation to use data from a trial -- which showed Xtandi worked better than a rival drug to halt the progression of cancer in patients whose disease was resisting other methods of treatment -- to update its labels in the region.
The ruling makes the company a more attractive takeover candidate, JMP Securities analyst Michael King said in a note.
Medivation is also developing pidilizumab, another immune-oncology drug, to be used as a treatment for blood cancers such as diffuse large b-cell lymphoma. The company is working on talazoparib for the treatment of breast cancer.