Flush-with-cash Shire revisits deal for NPS Pharma

Armed with a $1.64 billion breakup fee from former merger partner AbbVie ($ABBV) and a brand-new $2.1 billion revolving loan facility, Shire ($SHPG) looks ready to strike a deal. Rumor says it's revisiting some of its old targets, including New Jersey's NPS Pharmaceuticals ($NPSP).

Shire CEO Flemming Ornskov

Shire is eyeing the Bedminster company as a way to bolster its rare-disease lineup, according to Bloomberg sources. Citi says the Dublin drugmaker will have to fork over up to $5 billion if it wants the gastrointestinal and endocrine disorder specialist. But Citi also says an NPS acquisition could add as much as £5.50 to Shire's share price, London's Evening Standard reports.

Industry watchers started buzzing back in June that Shire could be preparing a 10-figure bid for the rare disease outfit, but the company may have shelved that plan when AbbVie came calling with a $55 billion buyout offer. Over the summer, CEO Flemming Ornskov admitted the Illinois pharma's advances had "stopped us in our tracks" in terms of its own dealmaking.

But new, stricter U.S. tax inversion rules spoiled the AbbVie tie-up, and since then avid buyer Ornskov has said he's ready to go back on the hunt. "That's in our DNA," he told investors earlier this month. "It's how we grow business."

If Shire does want to go after NPS, it might wait for the FDA to hand down a decision on NPS' Natpara, a hypoparathyroidism treatment that, if approved, would be the first treatment on the market for the potentially deadly disorder, Bloomberg notes. The agency's deadline to make up its mind on the med is January 24.

But on the other hand, Shire may not want to wait that long, the news service's sources said. Merck's ($MRK) recent pact to buy Cubist Pharmaceuticals ($CBST), a company that Shire had been considering, may spur the pharma to act sooner.

Either way, NPS isn't the only company on Ornskov's shopping list, Bloomberg reports. Citi estimates Shire has about $13 billion to spend on pickups; if it puts it all to use, its share price could reach £74, the bank figures.

- get more from Bloomberg
- see the Evening Standard's take

Special Reports: Pharma's top 10 M&A deals of 2013 - Shire/ViroPharma | The 25 most influential people in biopharma today - 2013 - Flemming Ornskov - Shire

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