August 4, 2014 / 3:50 PM / 5 years ago

Roche says to buy Danish Santaris for up to $450 million

ZURICH (Reuters) - Roche ROG.VX said on Monday it will buy Santaris Pharma, a privately-held Danish biotech company that has developed a new designer molecule, for up to $450 million in cash.

The logo of Swiss pharmaceutical company Roche is seen outside the Shanghai Roche Pharmaceutical Co. Ltd. headquarters in Shanghai May 22, 2014. REUTERS/Aly Song

Santaris, which was founded through a merger of two companies in 2003, develops drugs which work by blocking or “silencing” microRNAs — tiny strands of RNA, or ribonucleic acid, that help turn genes into proteins.

“This new class of medicines has the potential to address difficult to treat diseases in a range of therapeutic areas,” the Basel-based drugmaker said in a statement.

In the hotly pursued RNA interference field, Santaris has developed a new class of drug, known as Locked Nucleic Acid (LNA), which fine tunes the action of genes and has been shown to cut cholesterol in monkeys.

Santaris, which had previously secured funding from Roche to conduct research beyond 2014, is the second acquisition in short order for the Swiss firm, which splashed out $1.725 billion for Seragon Pharmaceuticals last month.

Since acquiring Genentech for $46.8 billion in 2009, Roche has earned a reputation as a disciplined acquirer, prepared to walk away from potential deals rather than overpay.

Chief Executive Severin Schwan abandoned a $6.8 billion deal to buy U.S gene sequencing company Illumina in 2012 and has snapped up a couple of smaller diagnostic companies this year instead of pursuing multi-billion deals.

Roche has also partnered with various companies to develop antibiotics and said in May that it would work with Inception Sciences Inc and Versant Ventures on a new company to develop therapies for patients with multiple sclerosis.

Prior to the Roche acquisition, Santaris’ part-owner, Danish venture capital firm Sunstone, had been eyeing a listing in the United States.

The terms of the deal, expected to close later this month, include $250 million upfront in cash with another $200 million pending the achievement of drug development targets, Roche said.

Other Santaris partners include Bristol Myers Squibb (BMY.N) and GlaxoSmithKline Plc (GSK.L).

Reporting By Katharina Bart; editing by David Clarke

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