for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up

Biogen draws takeover interest from Merck, Allergan: WSJ

Allergan ticker info and symbol are displayed on a screen on the floor of the New York Stock Exchange (NYSE) April 6, 2016. REUTERS/Brendan McDermid

(Reuters) - Biotechnology company Biogen Inc BIIB.O has drawn takeover interest from drug companies including Merck & Co Inc MRK.N and Allergan Plc AGN.N, The Wall Street Journal reported on Tuesday, citing people familiar with the matter.

The talks were informal and preliminary, the Journal said, adding they may might not result in a deal, in part because Biogen may not be interested.

Allergan was unlikely to pursue the deal, CNBC said, citing a source.

Biogen shares closed up 9.4 percent at $330.11 on Tuesday, valuing the company at about $72.33 billion. The stock fell 1.3 percent in extended trade following the CNBC report.

Officials at Cambridge, Massachusetts-based Biogen could not be reached for comment. Allergan spokesman Mark Marmur and Merck spokeswoman Lainie Keller said they do not comment on speculation.

The WSJ report came less than two weeks after Biogen reported surprisingly strong second-quarter earnings but said Chief Executive George Scangos, 68, would step down in coming months after a successor is found.

Although Biogen significantly raised its full-year earnings forecast, growth for its flagship Tecfidera treatment for multiple sclerosis has been slowing. The slowdown prompted the company last year to embark on a sweeping restructuring program to cut costs and focus on core areas, such as neurology, including treatments for Alzheimer’s disease.

Leerink Partners analyst Geoffrey Porges said Merck, Allergan or other large drugmakers would benefit from acquiring Biogen and its experimental drugs in late-stage trials, which include treatments for Alzheimer’s, multiple sclerosis and spinal muscular atrophy.

“There’s a scarcity of assets in the industry,” Porges said. “The industry needs to bulk up and consolidate and neither Merck nor Allergan have a multiple sclerosis business today,” he said, while Biogen is leading the field.

Reporting by Anya George Tharakan in Bengaluru and Ransdell Pierson in New York; Editing by Richard Chang and Savio D’Souza

for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up