Onyx rebuffs higher Amgen bid

Onyx Pharmaceuticals Inc., the biotechnology company said to have rebuffed an initial takeover bid from Amgen Inc., is involved with several potential purchasers, CEO N. Anthony Coles said. More

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Biotechnology

Onyx rebuffs higher Amgen bid

BLOOMBERG FILE PHOTO
AMGEN INC. reportedly increased its offer to buy Onyx Pharmaceuticals to $130 a share, but Onyx officials say the company is worth more.
Posted 8/9/13

NEW YORK -- Onyx Pharmaceuticals Inc., the biotechnology company said to have rebuffed an initial takeover bid from Amgen Inc., is involved with several potential purchasers, CEO N. Anthony Coles said.

“The process is ongoing with multiple parties currently engaged in discussions,” Coles said on a conference call Thursday after the South San Francisco, Calif.-based company released second-quarter earnings. Onyx wouldn’t comment further, Coles said.

Onyx’s suitors are interested in Kyprolis, a cancer drug approved last year for some patients with multiple myeloma. The treatment may draw $3 billion in revenue by 2022, according to analysts’ estimates compiled by Bloomberg. A deal would give a purchaser a likely boost in sales.

For Amgen, the therapy would supplement a roster of products aimed at helping cancer patients with their treatment with a medicine that targets cancer itself. Amgen, based in Thousand Oaks, Calif. with a plant in West Greenwcih, is the world’s biggest biotechnology company by revenue. The company is said to have boosted its offer for Onyx to $130 a share from $120 a share, Bloomberg News reported Aug. 6.

$140 a share

“We continue to see fair value for the company at $140/share,” Salveen Richter, an analyst for Canaccord Financial Inc. in New York, wrote Thursday in a note to clients. Richter said he expects Onyx will report data in the first half of 2014 to support expanded approval of Kyprolis to treat additional forms of multiple myeloma.

Onyx shares fell 1 percent to $126.10 at 12:38 p.m. New York time Friday. Amgen declined less than 1 percent to $109.67.

AstraZeneca Plc, Pfizer Inc. and Novartis AG had also expressed interest, Bloomberg reported in July.

Onyx also sells Nexavar for liver and kidney cancer in partnership with Germany’s Bayer AG. Onyx generated $362 million in 2012 revenue, with 80 percent coming from Nexavar and the stomach-cancer treatment Stivarga. The company gets a 20 percent royalty on Stivarga from Bayer, which has said it expects the medicine to be a bestseller.

Earlier, Onyx reported a second-quarter loss of 40 cents a share, excluding certain items, compared with expectations for a loss of 41 cents from 16 analysts’ estimates compiled by Bloomberg. Revenue of $153 million topped analysts’ estimates of $152 million.

Quarterly sales of Kyprolis were $61 million and the company reported an additional $10 million in revenue from the drug’s inventory at distributors that hadn’t yet been shipped to doctors and hospitals, the company said in its statement.

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