Onyx puts out 'for sale' sign after rejecting $10B Amgen bid

Onyx Pharmaceuticals ($ONXX) doesn't want to sell itself to Amgen ($AMGN) for $120 a share. But it would sell out to a bidder with the right offer. The cancer-drug developer says it's entertaining shoppers, expecting a price tag markedly higher than Amgen's $10 billion.

After concluding that Amgen's offer "significantly undervalued" the company and receiving "expressions of interest" from other potential buyers, Onyx decided to consider a deal, the company said in a statement. "We are actively exploring the potential to combine Onyx with another company," CEO Tony Coles said.

Onyx has been a favorite subject of deal talk in recent years, as its drug Nexavar--sold in partnership with Bayer--grew to blockbuster status and pipeline drugs neared the market. Now, the new stomach cancer treatment Stivarga, also marketed with Bayer, and Onyx's own blood cancer treatment Kyprolis have both been launched. And major drugmakers are hungry for products that can help backfill sales lost to generic competition. As Leerink Swann analysts said in an investor note this morning, Onyx is among a limited number of smaller drugmakers with enough revenue--and revenue potential--to "move the needle" for big biopharma companies.

Onyx has solicited interest from companies that previously said they'd like to make a deal, spokeswoman Lori Melancon told Bloomberg. That could be any number of drugmakers; ISI Group analyst Mark Schoenebaum figures that an Onyx deal "makes sense for a dozen companies or maybe more."

As an Onyx partner, Bayer is a perennial entry on the list of potential buyers, especially as it works to build up its oncology division. The German drugmaker wouldn't comment, however, telling FierceBiotech it doesn't comment on "market rumors." Analysts like the idea of an Amgen deal, too, figuring that the California-based company could add to its earnings by 2014 at a price around $140 per share; Onyx's cancer meds would complement Amgen's portfolio of other cancer treatments, they say. Other potential buyers active in oncology include Celgene ($CELG), which specializes in blood cancer treatments and could use Kyprolis to further flesh out its portfolio. And then there are Pfizer ($PFE) and GlaxoSmithKline ($GSK), which reportedly considered bidding for the company back in 2011.

- read the release from Onyx
- get the FierceBiotech story
- read the Bloomberg article

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