At last, the Sanofi-Aventis/Genzyme deal is done, in principle. It's being hailed as a win-win. And many non-investors now recognize CVR as contingent value right--a bonus promise tied to the success of products in development.
Sanofi chief Chris Viehbacher (photo) is being credited as the bridge-building negotiator who got the deal done. But let's not undervalue the business skill of Genzyme CEO Henri Termeer (photo). After all, the agreed upon price of $20.1 billion works out to $74 per share, which analysts bump up to $78 when they factor in that CVR. That price is a lot closer to the $80-per-share figure that Termeer was wielding last fall than it is to Viehbacher's $69 opener.
Also remember that Termeer's effort was made amid the crash of an FDA consent decree on Genzyme.
"Regulatory actions including consent decrees are increasingly part of the cost of business," says Jim Prutow, a partner in PRTM's healthcare practice, in an email. "They're not the death knell to a company's growth and acquisition options that they were in the past."
Consent decree remediation no doubt figured in the negotiations and may well have emboldened Viehbacher to initiate the takeover process. But such long-term and high-cost regulatory action is apparently just another factor in the new biopharma-deal math.