Medivation opens its books to would-be buyers, including the formerly hostile Sanofi

sanofi medivation

Medivation’s hostile fight with bidder Sanofi is over, and a new sale process has just begun.

After months of speculation--and back-and-forth with the determined French drugmaker--Medivation has invited a set of potential bidders to the table. The California-based biotech inked confidentiality agreements with “a number of parties” interested in making a deal.

That includes Sanofi, which agreed to drop its campaign to replace Medivation board members with its own friendlier slate. The Big Pharma did make a follow-up buyout offer of $58 per share, plus contingent value rights that could pay off at $3 per, but Medivation rejected it.

As this year’s most-popular acquisition target, Medivation and its deal dance have been closely watched, with the biggest names in biopharma on the list of potential bidders. Pfizer, AstraZeneca, Amgen, Gilead, Celgene and Novartis were all said to be circling in the background as Sanofi publicly pursued its original $52.50-per-share, $9.4 billion bid.

There’s good reason for the deal interest: Medivation shares in the blockbuster prostate cancer drug Xtandi, and it boasts a couple of pipeline drugs pegged as big sellers if they reach the market. One of those, the PARP inhibitor talazoparib, could theoretically be used alongside Xtandi in a cancer-fighting cocktail, helping to boost Xtandi’s sales while chipping in with sales of its own. 

Apart from Sanofi, Medivation did not identify any of the companies that struck confidentiality agreements in return for access to its books.

When Sanofi began its pursuit, Medivation called its bid laughably low, citing the potential payoff from Xtandi--which it’s studying in other cancers, including breast cancer--and its pipeline meds. Analysts pointed out that Medivation is one of the only biotech targets out there with a blockbuster marketed drug and pipeline offerings to boot--hence the only prospect that could immediately pump up sales while beefing up a buyer’s long-term expectations.

And given some impressive new data on a rival PARP inhibitor, posted by Tesaro last week, those expectations took an upward turn, analysts said. 

The company is well aware of that argument, and Chairman Kim Blickenstaff cited it in Tuesday’s announcement. “Medivation has significant scarcity value as one of the only profitable, commercial-stage oncology companies,” Blickenstaff said, going on to say that opening its books “will allow interested parties to fully understand the significant value of our Xtandi franchise and the enormous potential of our pipeline, including talazoparib, our promising, potential best-in-class PARP inhibitor.” 

- see Medivation’s announcement

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