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Could Actelion and Cipla be next on Big Pharma's M&A takeover list?

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Actelion CEO Jean-Paul Clozel

Switzerland's Actelion ($ATLN) has been on a winning streak of late, charting better-than-expected clinical trial results on its experimental drug to treat pulmonary arterial hypertension (PAH), and beating analysts' earnings expectations in the first quarter thanks to fast-growing sales of its new blood pressure treatment. It's no wonder, then, that the company is a perennial subject of takeover rumors. But CEO Jean-Paul Clozel isn't interested in entertaining any deal offers.

Clozel tells Bloomberg that Actelion has two potential blockbusters for the first time in its history--the PAH drug selexipag, now in Phase III trials, and the hypertension treatment Opsumit--and that should be enough to allow it to fend off potential acquirers. "We've proven to the world that for everybody--shareholders, patients, scientists--it makes much more sense to remain independent," Clozel said.

In mid-June, Actelion's shares jumped 15% on news that selexipag reduced the risk of a morbidity or mortality event by 39% over placebo in the latest trial. Clozel said at the time that he was "overwhelmed" by the result. The CEO does have a history of using positive news to hold off suitors, Bloomberg points out: In 2010, Actelion pointed to Opsumit's sales potential as a reason to prevent a takeover by Amgen ($AMGN) and a later attempt by a hedge fund to gain seats on the company's board. Actelion's stock has tripled in the past two years, giving it a market value of 12.8 billion Swiss francs ($14.3 billion).

That may be too pricey for a potential acquirer to consider, to be sure, so Wall Street analysts have been busy hunting for other likely M&A targets. Next on their list: India's Cipla, the maker of generic medicines to treat HIV, cancer, and respiratory diseases. IIFL holdings, an Indian brokerage firm, speculates that Teva Pharmaceutical ($TEVA) and Mylan ($MYL) could be potential suitors, according to Bloomberg.

Indeed, shares of Cipla have climbed nearly 8% since May 8, when rumors emerged that Teva may be considering a $6 billion buyout of the Indian company. It would reportedly be Teva's third attempt to buy Cipla, and many analysts agree it would be a good strategic fit. "It gives Teva, if they're interested, entry into the Indian pharma industry," Sarabjit Kour Nangra, an analyst at Angel Broking in Mumbai, told Bloomberg.

Cipla, Mylan and Teva all declined to comment on the market speculation, though Teva CEO Eyal Desheh has certainly been open to dealmaking. On June 3, the company bought Labrys Biologics, gaining access to an experimental migraine drug, in a deal worth $825 million. And at a Goldman Sachs conference last week, Bloomberg reports, Dasheh said he would consider more deals.

- here's the Bloomberg story on Actelion
- check out Bloomberg's take on Cipla

Special Report: Pharma's top 10 M&A deals of 2013

Related Articles:
Actelion racing to regulators after potential blockbuster PAH drug aces PhIII
Actelion wins crucial FDA approval for next-gen lung disease drug Opsumit
Teva buys into a blockbuster migraine drug with $825M Labrys buyout
Teva could kill 3 birds with one $6B deal for India's Cipla

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