Myovant has rejected the buyout offer from Japanese conglomerate Sumitomo. But stay tuned, because the Swiss pharma indicated that it’s willing to negotiate.
While Sumitomo already owns 52% of Myovant—thanks largely to a 2019 deal—the weekend offer was to acquire the remaining 48% at a per-share price of $22.75. The equity value of the deal would total $2.4 billion, Sumitomo pointed out, representing a 27% markup on the company’s market worth, as of its close on Friday.
But that wasn’t enough to sway Myovant’s board of directors, which assembled to assess the proposal, along with financial and legal advisors. Myovant said that the bid “significantly undervalues” the company but then added that it “remains open to considering any improved proposal that reflects the full and fair value.”
“(Myovant is) prepared to engage further with Sumitomo regarding any such proposal,” the company added.
In response to news of the offer and rejection, Myovant’s shares had surged by more than 37% by 11 a.m. on Monday, trading at $24.78 per share.
Sumitomo said in its release, issued Sunday, Oct. 2, that it has "no interest in selling any of the Myovant shares it owns" and would not "support any alternative sale, merger or similar transaction involving Myovant."
Sumitomo’s biopharma subsidiary Sumitovant considers Myovant an attractive target largely because of Myfembree, which was approved 16 months ago to treat bleeding that accompanies uterine fibroids. In 2020, Pfizer paid $650 million to get a piece of the drug, which gained a second FDA endorsement last month to treat the pain associated with endometriosis in premenopausal women.
Myovant also has a prostate cancer drug, Orgovyx, which was sanctioned in 2020 and generated sales of $83 million in the U.S. last year.
In its release, Sumitomo said that the proposal was a “natural step” considering Sumitovant and Myovant’s three-year collaboration. “(This is) an unprecedented opportunity to combine expertise, platforms and resources to deliver innovative therapies addressing unmet patient needs in women's health and prostate cancer,” Sumitomo wrote.
In 2019, the company paid $3 billion to Roivant to acquire its stake in five of its Vant startups, including Myovant, which was then just three years old. The move was designed to help Sumitovo compensate for its loss of exclusivity for bipolar and schizophrenia drug Latuda, which was approved in 2010 and now faces generic competition.