Savient sale fails despite Krystexxa OK

Woe is Savient Pharmaceuticals. The company finally succeeded in getting its gout drug Krystexxa approved by FDA--its first and only product so far--but lacks the money for a major launch. And its strategy for obtaining that money quickly has failed.

Savient put itself on the block, aiming to sell itself soon after winning the FDA nod for Krystexxa. Investors had hoped for a deal within three to four months, Reuters reports. And word on the street was that some big players were sniffing around, including Abbott Laboratories, Pfizer and Amgen.

No dice. The company announced yesterday that it had made no progress toward a sale. Its stock lost half its value, closing at about $12 yesterday.

Analysts theorize that Savient wanted more money than any interested parties were willing to pay. "The reason it wasn't bought is the same reason Biogen wasn't bought when it put itself up for sale two years ago," Summer Street analyst Carol Werther told Reuters. "I think the price was too high." But ironically, Savient's failure could become its savior. Now that its stock is trading much lower, potential bidders might come forward with offers they can afford. Fair value for the company, Wedbush Securities estimates, would be about $20 per share.

In any case, the company will probably be able to raise the money to market Krystexxa--by selling stock or convertible bonds--and then could sit back and wait for a better offer, Cowen & Co's Eric Schmidt tells Bloomberg. Bidders would then have a chance to see how Krystexxa performs. The launch date? Later this year, the company says.

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