Sanofi, Gilead said to be eyeing potential $10B deal for prime cancer target Tesaro

Zejula
The newly FDA-approved Zejula, a PARP inhibitor for ovarian cancer, is a key hook for potential Tesaro buyers.

Earlier this month, industry watchers questioned who could swallow the reportedly on-the-block Tesaro and its $7.5 billion-plus market cap. Now, though, it seems a pair of M&A-starved drugmakers may be interested in trying.

Sanofi—whose recent attempts at big M&A have been frustrated in very public fashion—is reportedly eyeing the Massachusetts biotech, StreetInsider reports. Unfortunately for the French drugmaker, though, it may already have competition. At least one other suitor is involved, too, and SI says it is “likely” Gilead Sciences.

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Whoever can land a Tesaro buy will gain access to Zejula, a PARP inhibitor approved to treat women with ovarian cancer. The med rolled out this year after winning a March approval, and it launched with a $118,000 price tag that undercut rivals Lynparza from AstraZeneca and Rubraca from Clovis Oncology.

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And Sanofi, which has already tried—and failed—to nab one PARP product, clearly finds the space attractive. It mounted a hostile takeover of California’s Medivation last year, only to see Pfizer eventually swoop in and grab its prize for a cool $14 million. (Later in the year, an attempt to buy Switerzerland’s Actelion—which ultimately structured a newfangled deal with Johnson and Johnson—went similarly.)

Gilead, though, has also said it’s planning to hunt for cancer deals—and that with hepatitis C sales freefalling, it’ll be relying on said deals for growth. The Big Biotech has a new pickup scout in place, too—it hired former Novartis exec Alessandro Riva in January—to make sure the company gets the job done.

One thing is clear: Whichever company does intend to take Tesaro home is going to have to pay up. According to StreetInsider’s source, a takeover of Tesaro would value the company at around $10 billion, or $185 per share.