In the latest round in the fight to gain full control of Genentech, Roche has revealed the gulf between its offer for the 44.2% stake that it does not already own in the US biotechnology giant and what the latter’s board thinks is a fair price.

In a filing by Roche to the US Securities and Exchange Commission, the company noted that while its hostile bid is $86.50 per share (or around $42.8 billion in cash), Genentech was looking for an offer of $112 per share, valuing the company at $52 billion. However, Franz Humer, chairman of the Swiss major, stated that Genentech's asking price "was not an appropriate starting point for negotiations."

The filing notes that the financial model prepared by Genentech used growth projections for Avastin (bevacizumab) and other therapies in its pipeline to determine the company's worth, among other considerations. However, Roche "disagreed with a number of assumptions" made by Genentech, particularly with regard to Avastin and its success in current clinical trials for a variety of cancer, notably colorectal cancer.

Roche added in the filing that it intends to exercise its right to have a majority on Genentech's seven-member board, on which three representatives of the Basel-based group currently sit. It also reiterated that its lower bid (an $89 per share offer was made in July) reflects the “worldwide economic downturn that has altered expectations for future cash flows and "key valuation assumptions and estimates."

Nevertheless, Dr Humer had earlier released a statement saying that “while we have changed our approach to the transaction, our plan on how we will combine the two companies remains unchanged”. He added that “we will take the necessary steps to nurture Genentech's innovative and unique science-driven culture”.

Dr Humer added that “we remain committed to retaining Genentech’s top talent”, noting that Roche Pharma’s commercial operations in the USA will be transferred from Nutley to the biotech giant’s base in South San Francisco. It will “reflect the Genentech name, leveraging the strong brand value of Genentech,” he concluded.

In an investor note, JPMorgan analyst Geoffrey Meacham said "the Roche model is unduly conservative, while Genentech's is a mixture of realistic and aggressive, but overall we believe it supports a $100-plus deal price." He added that "we believe Roche is committed to the acquisition and hence will ultimately have to increase its bid".