With Opsumit approved, analysts say Actelion primed for takeover

The EU on Friday recommended approval of Actelion's ($ATLN) Opsumit, following FDA approval the week before, and by today the takeover talk was in full swing. With regulators giving thumbs-up to a drug projected to be a blockbuster, analysts say any number of companies may want to do a deal and add the assured revenue to their own top lines.

Opsumit is Actelion's new pulmonary arterial hypertension (PAH) treatment and a follow-up to Tracleer, its only significant product. With Opsumit a potential blockbuster and with another PAH drug in the pipeline, analysts see the Swiss company as a prime takeover target.

"The risk is out and it's going to make it more attractive and easier for the company to be valued," Philippe Comby, a fund co-manager at Swiss Hottinger Capital Corp., told Bloomberg. "It's probably an M&A candidate for sure now."

Jefferies Group LLC said the approval could be bait for companies like GlaxoSmithKline ($GSK), which sells a competing drug in Europe, or even Bayer, which had its own PAH drug approved by the FDA this month as well. And UBS noted that Actelion has another PAH drug, selexipag, in its pipeline. If it can pull off successful Phase III data next year, the odds of a deal are enhanced.

The FDA approval Oct. 18 for Opsumit was a huge relief for Actelion execs, given that Tracleer, as Bloomberg points out, delivered 87% of the drugmaker's $1.84 billion in revenue last year. Tracleer continues to sell well. Its revenues were up 3% in the the latest 9-month period, but it goes off patent in 2015. Opsumit does face competition. The new Bayer drug, Adempas, was approved not only for PAH but also for treating a second form of rare pulmonary disorder. Gilead Sciences ($GILD) has Letairis, a drug that had been taking market share away from Actelion's Tracleer, Bloomberg said, because it does not carry a warning for potential liver damage. But Opsumit does not carry a liver warning, clearing that obstacle for Actelion. GlaxoSmithKline sells the Gilead drug under a different brand name in Europe.

Some analysts think Actelion's market value of nearly $9 billion may make it too pricey to draw bidders. In the eyes of Sphera Funds Management partner Ori Hershkovitz, the best bet for Actelion would be to wait until the picture for selexipag becomes clearer, he tells Bloomberg. If it reports out positive data in mid-2014, "then all hell breaks loose. It could be a huge company."

- here's the Bloomberg story

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