By Soyoung Kim
NEW YORK, July 16 Onyx Pharmaceuticals Inc
is expected to receive initial takeover bids as soon as
this week after attracting interest from a few drugmakers,
including Amgen Inc, according to several people
familiar with the matter.
Amgen, whose opening offer of $120 per share was rejected by
Onyx's board in late June and led to an auction of the company,
is still keen to buy Onyx and appears to be the most likely
buyer, the people said this week.
Other pharmaceutical companies including Pfizer,
Bristol-Myers Squibb Co and Gilead Sciences Inc
have also been evaluating a deal, though it remains unclear if
those parties will proceed with offers given Onyx's rich
valuation - with a market value of nearly $10 billion, the
While a number of big pharmaceutical and smaller biotech
companies signed confidentiality agreements to take an initial
look, many of the parties balked at Onyx's price tag and decided
against bidding for the cancer drugmaker, the people said.
There is no specific date for first-round bids, but
interested parties are expected to submit non-binding offers
this week, the sources said, asking not to be named because
details of the auction are not public.
Representatives for Onyx and Pfizer declined to comment.
Bristol-Myers, Gilead and Amgen could not be immediately reached
Shares of Onyx have surged more than 50 percent since June
30 when it put itself up for sale citing expressions of interest
from Amgen and other third parties. Onyx shares closed up 1.2
percent at $132.71 on Tuesday.
The steep stock price increase has deterred several
drugmakers, leaving a relatively short list of remaining bidders
just two weeks into the process, the people said.
The drugmakers, which have opted not to pursue a deal,
include Novartis AG, GlaxoSmithKline Plc,
Sanofi SA and Biogen Idec Inc, the people
familiar with the matter said. The companies declined to
Onyx hopes to wrap up the auction by the end of the summer,
some of the people added.
Large pharmaceutical and biotech companies have been looking
to acquire smaller biotech firms to gain access to new drugs and
offset revenue losses stemming from expired patents, but rich
valuations of target companies are proving to be a big hurdle to
Meanwhile, U.S. investment firm Royalty Pharma is
interested in buying some of the royalty streams should a
winning bidder emerge for Onyx, according to the people familiar
with the matter.
There are no active discussions underway for now, and the
likelihood of such a deal remains low, as most of the potential
buyers are in a position to acquire the entire company and do
not need a side deal to sell off royalties, the people added.
A representative for Royalty Pharma declined to comment.
Onyx sells Nexavar, a treatment for liver and kidney cancer,
and the new colon cancer drug Stivarga - both in partnership
with Germany's Bayer AG. Onyx last year began selling
Krypolis, which some analysts estimate will reach peak annual
sales of $3 billion.