NEW YORK (Reuters) - Amgen Inc, the world’s largest biotechnology company, has lined up Bank of America Corp, JPMorgan Chase & Co and Barclays Plc to finance a potential deal for Onyx Pharmaceuticals Inc, according to three people familiar with the matter.
Thousand Oaks, California-based Amgen, whose preliminary $120 per-share offer for Onyx was rejected by the company’s board last month, is still keen to buy the cancer drugmaker and waiting to see if a higher competing offer will materialize, the people said on Wednesday.
All the sources asked not to be named because the matter is confidential. Onyx, Amgen, Bank of America, JPMorgan and Barclays declined to comment.
Onyx put itself up for sale on June 30, citing expressions of interest from Amgen and other third parties.
Shares of the company, which closed at $86.82 on June 28 before news of the sale process, have since surged more than 50 percent to trade above $130, valuing the South San Francisco, California-based company at around $9.5 billion.
The steep price gains, as well as the floor price that Amgen has set with its initial $120 per-share offer, deterred several pharmaceutical and biotechnology companies that would otherwise have been interested in bidding, people familiar with the matter have said.
Amgen has faced growing pressure to beef up its drug development pipeline as safety concerns trimmed sales of its flagship anemia drugs, while patents on four of Amgen’s five top-selling drugs are set to expire, starting in 2015.
The company is best-known for these and other medicines used in supportive care of cancer patients.
Amgen Chief Executive Bob Bradway, a former Morgan Stanley investment banker, took over from Kevin Sharer just over a year ago. Amgen shares have rallied since then as investors applauded the company’s higher dividends and share repurchases.
The company’s late-stage pipeline has several cancer drug candidates, including some acquired through takeovers.
Cancer medicines are the holy grail for many drugmakers because of the limited effectiveness of current products and huge prices that can be charged for new biotech treatments.
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 Kyprolis for multiple myeloma, which some analysts estimate will reach peak annual sales of $3 billion.
Reporting by Soyoung Kim and Jessica Toonkel in New York, additional reporting by Ransdell Pierson; editing by Matthew Lewis