Shire is making a hostile takeover approach for Baxalta just a month after the biotech was spun off from Baxter.
The proposed all-stock transaction would be worth approximately $30 billion. Shire believes it would create “the global leader in rare diseases with multiple billion-dollar franchises in high-value therapeutic areas with substantial barriers to entry.”
Baxalta’s management has so far declined to engage in substantive discussions regarding the proposal, which Shire says has “left us with no choice but to make our proposal known to [Baxalta’s] shareholders. We believe they deserve an opportunity to consider it”.
Flemming Ornskov, chief executive officer of Shire, laid out the advantages of the deal in his statement: “We believe the proposed combination of Shire and Baxalta would be strategically and financially attractive for both of our companies, accelerating our respective growth ambitions and creating the leading global biotech company in rare diseases.
“Together, the companies would be projected to deliver $20 billion in product sales by 2020, with the financial and operational firepower to fuel further innovation and growth in rare diseases. It is our strong preference to immediately enter into a negotiated transaction to explore the full potential of the proposed combination and finalise the terms of an agreement.”
Foresight Biotherapeutics deal
This is no less than the second M&A move from Shire in the space of a week. On Monday it announced that it would be acquiring eye-drug specialist Foresight Biotherapeutics for $300 million.
This is primarily to give the company access to Foresight’s ST-100 (topical ophthalmic drops combining 0.6% povidone iodine (PVP-I) and 0.1% dexamethasone), a therapy in late-stage development for the treatment of infectious conjunctivitis.
If approved for sale, FST-100 has the potential to become the first drug to treat both viral and bacterial conjunctivitis.