February 2, 2009 / 6:38 AM / in 10 years

UPDATE 3-Astellas says bid for CV Therapeutics its best offer

*Says bid for CV Therapeutics is “best offer”

*Q3 profit falls 12 pct, hit by higher R&D costs, yen

*Raises full-year forecast by 4 percent

*Shares close down 2 pct ahead of announcement (Adds details on Astellas’ results, outlooks)

By Yumiko Nishitani

TOKYO, Feb 2 (Reuters) - Japanese drugmaker Astellas Pharma Inc (4503.T) said its $1 billion bid for U.S. biotechnology firm CV Therapeutics Inc CVTX.O is its best offer, ruling out the possibility of sweetening its bid for now.

An executive of Astellas, Japan’s second-largest drugmaker after Takeda Pharmaceutical (4502.T), made the comment at a news conference to unveil its October-December earnings.

Astellas posted a 12 percent fall in quarterly profit, hit by the higher cost of enhancing its product pipeline, but raised its full-year outlook slightly thanks to the strong yen, which helped trim the cost in yen of its overseas spending.

Astellas announced its $16 per share bid for CV Therapeutics last week, making public an offer that CV Therapeutics had previously rejected.

Shares of CV Therapeutics briefly jumped above the $16 offer price but closed Friday at $15.65, indicating some investors were speculating that the deal would not go through.

“We are not considering a hostile takeover. We think we made a fair offer and the best possible offer,” Astellas Senior Corporate Executive Hirofumi Onosaka told a news conference.

Astellas said it now sees a pretax recurring profit of 270 billion yen ($3 billion) for the year to March 31, up from its previous estimate of 259 billion yen and higher than the average forecast for a 261.8 billion yen in a poll of 13 analysts by Reuters Estimates.

Japanese drugmakers, which like bigger global rivals are trying to fill revenue gaps caused by patent expirations, are increasing spending to beef up product pipelines, including acquisitions.

Such spending also weighed on Astellas in the third quarter. Its mainstay transplant drug Prograf lost U.S. patent protection in April.

It booked increased research and development costs and goodwill costs, both related to the purchase in December 2007 of Agensys Inc, a U.S. biotechnology firm focused on antibody research and development for cancer treatment.

Astellas also wrote off the depreciation of its new research built in the city of Tsukuba, northeast of Tokyo, last September.

Astellas, which generates nearly half of its revenues abroad, posted a recurring profit of 95.7 billion yen for the October-December quarter, down from 109.05 billion yen in the same period a year earlier.

Astellas shares fell 17 percent in October-December, outperforming the Nikkei average <.N225 >, which fell 21 percent.

Prior to the announcement, shares of Astellas ended the day down 2 percent to 3,370 yen. The Nikkei fell 1.5 percent. ($1=89.81 Yen) (Reporting by Yumiko Nishitani; Editing by Michael Watson)

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