If at first you don't succeed, bid, bid again. That's the motto of Japan's Astellas Pharma, which has just launched a hostile bid for U.S. drugmaker OSI Pharmaceuticals at $52 a share, of $3.5 billion. OSI management rejected that offer earlier in February, Astellas says, so it's taking its case directly to the shareholders.
The jewel that Astellas is after is Tarceva, OSI's cancer drug that it markets in partnership with the Swiss drug giant Roche. Like many a Big Pharma, Astellas has some key drugs going off patent in the coming years, so it's hunting about for assets to help fill the sales gaps. Astellas also wants to become a global leader in oncology meds; nabbing Tarceva could go a long way toward making that goal a reality, Reuters reports.
The $52 offer is a 40 percent premium over OSI's closing price on Friday, but OSI management deemed it inadequate, saying that it "very significantly undervalues" the company. Astellas says it's open to talking with OSI about a negotiated deal. In the meantime, its offer is on the table, and it's planning to nominate directors at OSI's upcoming annual meeting.