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Apr-13-2008Takeda Faces Generic Threat Even With Millennium Buy (Update5)(topic overview)
CONTENTS:
- Takeda Pharmaceutical Company Limited, the largest drug maker in Japan, announced on Thursday that it reached a definitive agreement over the acquisition of the U.S. company Millennium for around 8.8 billion dollars. (More...)
- Takeda shares dropped 110 yen, or 2 percent, to 5,300 yen today and have plunged 33 percent the past year, even as Hasegawa announced plans to buy back as many as 34 million shares, made three acquisitions and increased dividend payments. (More...)
- Millennium markets Velcade, an injectable cancer treatment cleared for sale in more than 85 countries, and has a pipeline focused on oncology and inflammation. (More...)
- Today's deal takes the company in the direction the global pharma herd is moving: Away from old-school primary care drugs for chronic conditions, and toward specialty biotech drugs that command higher prices. (More...)
- The company, which reported total revenue of $528 million for 2007, said it has complementary research, development and commercialization capabilities with Takeda. (More...)
- The local biotech's most well-known drug is Velcade, a blood cancer treatment. (More...)
- For Millennium, the Takeda takeover ends what has been a decidedly mixed run as an independent bio-pharmaceutical company. (More...)
- The idea was that if disease-causing genes could be targeted, drug discovery might be accelerated. (More...)
- Even adjusted for inflation, it ranks larger than Cambridge-based Biogen Inc.' s purchase of Idec Pharmaceuticals Corp. of San Diego five years ago for $5 billion. (More...)
- I also find it interesting that the company hasn'''t decided to put up a big research site in one location and call it '''Takeda ''' US''', but have rather taken the retail approach. (More...)
- Takeda earlier noted that it expects sales and cost synergies from the restructuring in the U.S. operations. (More...)
- The company is running more than 15 oncology trials for drugs that may treat tumors of the blood, prostate and liver. (More...)
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Takeda Pharmaceutical Company Limited, the largest drug maker in Japan, announced on Thursday that it reached a definitive agreement over the acquisition of the U.S. company Millennium for around 8.8 billion dollars. The offer of 25 dollars per share was unanimously approved by both companies' Boards of Directors, as the bid represents a 53 percent premium over the Millenium's closing price a day before and the transaction would offer Takeda the possibility to enter the U.S. pharmaceutical market. Millenium will also offer Takeda its Velcade, a drug used after other drugs fail in the treatment of rare blood cancers. "Millennium greatly strengthens Takeda's global oncology portfolio, led by the flagship product VELCADE, and further enhances its pipeline with clinically differentiated, high-quality product candidates," said Yasuchika Hasegawa, President of Takeda Pharmaceutical Company Limited. Through the deal, Takeda starts its plan to become a global leader in oncology, as both companies have complementary research, development and commercialization capabilities, which can potentially turn into a powerful drug development engine. [1] Millennium Pharmaceuticals Inc. has agreed to be bought by Japan's Takeda Pharmaceutical Co. Ltd. for approximately $8.8 billion in cash. Millennium (Nasdaq: MLNM), a Cambridge-based biopharmaceutical company, reported that its stockholders would receive $25 per share, a 53 percent increase over yesterday's close. Millennium markets Velcade, an injectable blood cancer drug, in more than 85 countries, and has a product in its pipeline that could help treat inflammatory bowel disease. That product is expected to enter Phase 3 clinical trials in late 2008 or early 2009, company officials said.[2]
Millennium Pharmaceuticals Inc., one of the Bay State's best known biotech companies, is being sold. Japanese drug marker Takeda Pharmaceutical Co. Ltd. said early this morning it would buy the Cambridge biotech for $8.8 billion in cash, more than 50 percent more than the company's closing stock value Wednesday. Millennium makes a cancer drug, called Velcade, that is expected to become a multibillion-dollar drug in coming years, and has several more experimental drugs in its pipeline.[3]
Takeda, Japan's biggest drug company, is buying Cambridge, Mass. -based Millennium Pharmaceuticals for $8.8 billion, or $25 a share. That's a 50% premium and a price Millennium stock hasn't seen in more than five years. "New York's Fifth Avenue is now awash with foreign shoppers convinced that the prices of goods in U.S. dollars are a bargain," wrote Bernstein analyst Geoff Porges in a research note this morning. "While the situation is not identical, U.S.-based biotechs and their shareholders are benefiting from the discounted value of the U.S. dollar compared to other currencies."[4] NEW YORK (AP) — Wall Street applauded Takeda Pharmaceuticals' $8.8 billion cash bid for Millennium Pharmaceuticals, which will give the Japanese company access to a lucrative blood cancer drug and stockholders of the Cambridge, Mass. biotech firm a sweet premium on their shares.[5]
TOKYO (AP) — Takeda Pharmaceutical Co. announced an $8.8 billion bid for U.S. biotechnology company Millennium Pharmaceuticals, an all-cash offer that would give Japan's top drug maker a key cancer treatment. Takeda, which specializes in treatments for diabetes and cardiovascular problems, continues to push for more access to cancer drugs with its most recent bid. Millennium's top drug is the blood cancer treatment Velcade, which is expected to generate revenue of $345 million this year.[6] Takeda Pharmaceutical of Japan has announced plans to purchase U.S. biotech firm Millennium Pharmaceuticals in a deal valued at nearly $9 billion. The deal is the largest transaction involving a Japanese company so far this year and brings the Osaka-based Takeda a new therapeutic area -- cancer treatments. Millennium's leading product is Velcade, a blood cancer treatment expected to generate revenues of as much as $345 million this year, according to analysts.[7]
Nikkei English News - Apr. 11, 2008 TOKYO -(Dow Jones)- Investors reacted coldly Friday to Takeda Pharmaceutical Co.' s (4502.TO) $8.8 billion all-cash deal to acquire Millennium Pharmaceuticals Inc. (MLNM), with analysts questioning the high premium paid for the U.S. biopharmaceutical company. After losing as much as 6.5%, Takeda shares ended morning trading down 2.8% at Y5,260 - against an overall market gain of 2.1% - even as Takeda pledged to buy back up to 1.24%, or 11 million, of its outstanding shares for up to Y60 billion.[8] TOKYO (Reuters) - Shares in top Japanese drug maker Takeda Pharmaceutical Co (4502.T: Quote, Profile, Research ) fell 2 percent on Friday, a day after it said it would spend $8.8 billion to buy U.S. biotech firm Millennium Pharmaceuticals (MLNM.O: Quote, Profile, Research ), and analysts gave mixed reactions to the acquisition.[9] TOKYO (Reuters) - Takeda Pharmaceutical Co Ltd (4502.T: Quote, Profile, Research ) said on Thursday it has agreed to buy U.S. biotechnology company Millennium Pharmaceuticals Inc (MLNM.O: Quote, Profile, Research ) for $8.8 billion to bolster its cancer drug business, in the biggest overseas acquisition by a Japanese drugmaker.[10]
Japan's Takeda Pharmaceutical Co. agreed to buy U.S. biotech company Millennium Pharmaceuticals Inc. for $8.8 billion, giving Takeda a major presence in the lucrative cancer-drug market while also adding a number of promising drug candidates to its pipeline.[11] HONG KONG (ThomsonFinancial) - Japan's largest drug company Takeda Pharmaceutical Co. Ltd. (OOTC:TKPHY) said Thursday it's buying U.S. biotech company Millennium Pharmaceuticals, Inc. (NASDAQ:MLNM) for $25 a share, in an all-cash deal valued at about $8.8 billion.[12] Millennium Pharmaceuticals (NASDAQ: MLNM ) has been snatched up for just shy of $9 billion by Takeda Pharmaceutical Company, Japan's largest drugmaker. The deal, approved unanimously by each company's board and announced early this morning, calls for Takeda to acquire Millennium for $8.8 billion through a $25-per-share cash tender offer. That price represents a 53 percent premium over yesterday's closing price of $16.35.[13] A Big Pharma facing a patent cliff has to drop a boatload of cash to pick up a mid-sized biotech with a promising pipeline. Taking a classic page from the Big Pharma survival playbook, Takeda Pharmaceutical, Japan's biggest drug maker, said this morning it would spend nearly $9 billion to buy Millennium Pharmaceuticals, a U.S. biotech that makes the cancer drug Velcade. That's a hefty premium of 53% to yesterday's closing price.[14] For some drug industry watchers, the Millennium purchase price was too high at $25 a share, a 53 percent premium to the biotech firm's closing share price on Wednesday. They note that the addition of Millennium's top drug, blood cancer treatment Velcade, to Takeda's portfolio would not be enough to stave off a big drop in revenue when the Japanese firm loses U.S. patent protection on its main earnings driver, the diabetes drug Actos. Merrill Lynch cut its rating to "sell" from "buy".[9] Takeda will buy the U.S. company based in Cambridge Mass. for $25 a share which represents 52.9% premium on $16.35, Millennium's closing share price on Wednesday. The deal was announced after trading closed and it is the largest transaction involving a Japanese company in this year according to the Wall Street Journal. With this merge the Japanese firm, which specializes in treatments for cardiovascular and diabetes treatments, will benefit from Millennium's cancer drugs.[15]
Millennium's revenue for 2007 totaled $528 million. The Millennium deal is in line with Takeda's recent loosening of its purse strings to buy growth. Earlier this year, it bought the Japanese market rights for new drugs currently in development by U.S. biopharmaceutical company Amgen Inc. (AMGN). That deal will see Takeda initially pay as much as $1.18 billion, as well as offer royalties and new-drug development funding.[16] Takeda in February agreed to buy Amgen Inc.' s Japanese unit for as much as $902 million, gaining about a dozen experimental medicines including two in the final stages of human testing for lung cancer. Takeda hasn't developed any cancer therapies in its own labs that have progressed to advanced human trials. The drugmaker wants to strengthen its cancer business, "where we had a slow start in sales and in getting sufficient compounds into the pipeline,'' Takeda President Yasuchika Hasegawa told reporters in Tokyo yesterday. He said Takeda will provide details on the deal's impact on earnings when the drugmaker reports results on May 9. It sought U.S. approval in January for alogliptin, a once- daily treatment for type-2 diabetes and the candidate to succeed Actos. The new drug will have to go up against a similar-acting drug, Januvia, sold by Merck & Co. that generated sales of $667.5 million in its first full year on the market in 2007. "As Takeda faces the expiration of the Actos patent, it needs to make effective use of its financial resources to make up for it,'' said Kumi Miyauchi, a drug analyst with Daiwa Institute of Research in Tokyo.[17] Analysts believe that Velcade can bring in more than $1 billion in worldwide sales, in future. Other promising cancer medicines and various drugs of Cambridge-based Millennium are still being tested on patients and may not be approved by regulators until after 2011. Osaka-based Takeda is in need of new drugs and research capacity because its biggest seller, the diabetes drug Actos''' patent expires in 2011. Takeda and Abbott Laboratories, only a month ago had declared plans to split up their decades-old drug-sales joint venture, TAP Pharmaceutical Products Inc. Post the split, North Chicago-based Abbott will gain U.S. rights to Lupron, a prostate cancer medication with $600 million in annual sales, and $1.5 billion in cash, while Takeda will get the overseas rights to Lupron and global rights to the $2 billion-a-year heartburn drug Prevacid.[18] Millennium will operate as a wholly owned subsidiary in Cambridge, Mass. and continue to sell Velcade and future oncology products. Just last month, Takeda and Abbott Laboratories announced plans to split up their decades-old drug-sales joint venture, TAP Pharmaceutical Products Inc. As part of that split, North Chicago-based Abbott will receive U.S. rights to Lupron, a drug with $600 million in annual sales, and $1.5 billion in cash while Takeda receives the overseas rights to Lupron and global rights to the $2 billion-a-year seller, the heartburn drug Prevacid as well as similar treatments in the pipeline.[19]
One of Millennium's major drugs is Velcade, a blood cancer drug treatment expected to generate revenue of $345 million in 2008. Takeda is trying to avoid a loss in revenue as the patents of two of its top selling products, Prevacid (ulcer treatment) and Actos (diabetes treatment) expire in 2009 and 2011 respectively. Takeda is using its cash in acquisitions or licensing agreements now. In February, Takeda acquired a Japanese unit Amgen Inc. and obtained rights to market several of its cancer drugs in Asia. It also bought Abbott Laboratories and the license to develop and sell a prostate cancer vaccine from Cell Genesys Inc. This article is copyrighted by International Business Times.[15] Takeda would expand in the U.S. and expand its product line with Millennium's specialization in cancer treatments. The acquisition comes with the blood cancer treatment Velcade, which is expected to generate revenue of $345 million this year.[20] The patents on two of Takeda's biggest-selling products -- ulcer drug Prevacid and diabetes treatment Actos -- expire in 2009 and 2011, respectively. Revenue from Millennium's best-selling product, blood-cancer treatment Velcade, is growing quickly and is expected to reach as much as $345 million this year. Sales of Velcade could get another big boost this summer when the U.S. Food and Drug Administration rules on an application from Millennium to sell the drug as a first-line treatment for multiple myeloma.[11]
The company had revenue of about $528 million in 2007. Osaka-based Takeda said the deal will boost its global oncology portfolio by adding Millennium's flagship product Velcade, a treatment for patients with relapsed multiple myeloma.[12] Millennium, a biopharmaceutical company, reported total revenues of approximately $528 million for 2007. The Boards of Directors of both companies unanimously approved the transaction. Commenting on the deal, Yasuchika Hasegawa, President of Takeda Pharmaceutical stated, 'Millennium greatly strengthens Takeda's global oncology portfolio, led by the flagship product VELCADE, and further enhances its pipeline with clinically differentiated, high-quality product candidates.[21] Upon the deal closure, Millennium will become a wholly-owned subsidiary of Takeda Pharmaceutical, and will continue operations in Cambridge, Massachusetts, as a standalone business unit. Commenting on the deal, Yasuchika Hasegawa, President of Takeda Pharmaceutical stated, 'Millennium greatly strengthens Takeda's global oncology portfolio, led by the flagship product VELCADE, and further enhances its pipeline with clinically differentiated, high-quality product candidates.[22]
J apan's Takeda Pharmaceutical Co. plans to shell out "retention bonuses" to most of Millennium Pharmaceuticals Inc.' s 1,000 employees after its blockbuster 8.8 billion takeover of the Cambridge company is completed later this spring. Takeda, which shocked the Boston business community yesterday morning with its surprise offer to buy Millennium, is determined to keep its new employees as it solidifies its U.S. base in Cambridge and rolls out new drug products, a high-level Millennium executive said yesterday. "It's highly unusual," Anna Protopapas, senior executive vice president at Millennium, said of Takeda's unspecified monetary incentives for employees to stay with the company for 12 to 24 more months after the takeover. Bob Coughlin, chief executive of the Massachusetts Biotechnology Council, said the bonus move is "extraordinary" and shows Takeda, Japan's largest drug company, is serious about its commitment to Millennium's future as a standalone subsidiary. He said the incentives are clearly aimed at calming the nerves of Millennium employees who might be upset at the prospect of a new owner.[23] Takeda Pharmaceutical Co., Japan's largest drug maker, agreed to buy Millennium Pharmaceuticals Inc. for $8.8 billion, gaining a cancer medicine poised for wider use.[24] Mass. biotech is sold for $8.8b Boston Globe Millennium Pharmaceuticals Inc., one of Massachusetts' best-known biotechnology companies, has been sold to Japanese drug maker Takeda Pharmaceutical Co. for $8.8 billion, making it the biggest deal in the history of the state's biotech industry.[25] Biopharmaceutical firm Millennium Pharmaceuticals Inc. is in an agreement to be acquired by Japanese drug maker Takeda Pharmaceutical Co. Ltd. in a deal valued at $8.8 billion.[26]
The latest example of the trend came from Takeda Pharmaceuticals, a Japanese drug maker that put together a $8.8 billion bid for Millennium Pharmaceuticals of Cambridge.[27]
TOKYO (AP) — Japan's Takeda Pharmaceutical is bidding $8.8 billion for American biotech Millennium Pharmaceuticals Inc. in what would be the largest buyout this year by a Japanese company.[20] NEW YORK -- Shares of Millennium Pharmaceuticals are surging after Takeda Pharmaceuticals of Japan agreed to buy the biotechnology company for $8.8 billion, or $25 per share.[28] Millennium Pharmaceuticals said early Thursday that it would be acquired by Takeda Pharmaceutical for about $8.8 billion, through a cash tender offer of $25.00 per share. The deal, unanimously approved by the Boards of Directors of both companies, is expected to close in the second-quarter of 2008.[29] Millennium Pharmaceuticals MLNM said Thursday that it will be acquired by Japan's largest drugmaker, Takeda Pharmaceuticals, in a deal worth $8.8 billion -- the largest overseas acquisition by a Japanese drugmaker to date.[30] Japan's top drugmaker, Takeda Pharmaceutical (other-otc: TKPHF - news - people ), said it had agreed to acquire Millennium Pharmaceuticals (nasdaq: MLNM - news - people ) in a deal worth about $8.8 billion.[31]
April 10 (Bloomberg) -- Takeda Pharmaceutical Co., Japan's largest drugmaker, agreed to buy Millennium Pharmaceuticals Inc. for $8.8 billion, gaining the cancer medicine Velcade that is poised to win wider use.[32] In its second major effort to grow in the lucrative U.S. market, Takeda Pharmaceutical Co., Japan's largest drugmaker, agreed to buy Millennium Pharmaceuticals Inc. for more than $8 billion, gaining the cancer medicine Velcade that is poised to win wider use later this spring.[19]
Takeda Pharmaceuticals Ltd. continued its recent love affair with U.S. biologics, entering into an agreement to purchase Millennium Pharmaceuticals Inc. for $8.8 billion, and instantly gaining a strong foothold in the cancer field.[33]
The Japanese Takeda Pharmaceutical Co. agreed to buy Millennium Pharmaceuticals, Inc. a biotechnology company, for $8.8 billion on a move to remain competitive in the global market.[15] Takeda Pharmaceutical Co., Japan'''s largest drugmaker has agreed to buy U.S.-based Millennium Pharmaceuticals for $8.8 billion.[18]
Rule Breakers pick Millennium Pharmaceuticals (Nasdaq: MLNM ) said that Takeda Pharmaceuticals was acquiring it for $8.8 billion in cash, a 53% premium to where it closed on Wednesday. Takeda's buyout is ironic because in the past few years, Millennium has been the one trying to make acquisitions: It even failed in a bidding war with Genzyme (Nasdaq: GENZ ) for AnorMED two years ago.[34]
The takeover premium for Millennium is more than double the 23 percent Tokyo-based Eisai paid to acquire MGI Pharma. Earlier this week, Switzerland's Novartis AG agreed to buy 77 percent of eye-care company Alcon Inc. in a two-step transaction totaling $39 billion. The acquisition was the biggest in health care this year. "Takeda paid such a premium, in cash, with a $250 million cash breakup fee, to close this deal quickly and shut down the possibility that Millennium investors would hold out for a higher bid,'' said Chris Raymond, an analyst with Robert W. Baird & Co. in Chicago, in an interview.[32] Takeda will be paying cold, hard cash--it had built up a 1 trillion yen ($9.9 billion) war chest to make acquisitions. The deal should come as a relief to Takeda holders--investors have dumped the company's shares over the past six months out of frustration at its slowness in putting the cash hoard to work. Given the weakening of the dollar--the greenback has fallen 15% against the yen over the past 12 months--waiting has allowed Takeda to get more for its money. It also has allowed Takeda to pay a substantial premium in dollar terms, virtually ensuring acceptance of the offer by Millennium shareholders.[31] Not that a 50 percent-plus price premium is anything to scoff at, but I can't help viewing Millennium's exit in light of the predictions that then-CEO Levin shared with me back in 2001: "Over the next five to 10 years, our goal is to become a company that's leading the world in personalized medicines, a company that is leading the world in productivity, a company with a value of over $100 billion, a company that has five to 10 products on the market that are making a big difference in people's lives, a company with the strongest pipeline in the entire industry." Shares of Millennium opened this morning at $24.46, close to the acquisition price. The deal, which is subject to shareholder approval, is expected to close this quarter.[13]
Millennium shareholders will receive $25 a share in cash, 53 percent more than the April 9 closing price before the deal was announced, revealed the two companies. "This deal will boost Takeda's drug-development flow," said Mitsuo Ohmi, a Tokyo-based analyst at Japan Advisory LLC. "Millennium is a leader in genome medicine, with some promising drugs in early development."[18] Stockholders of Cambridge-based Millennium will receive $25 a share in cash, 53 percent more than Wednesday's closing price, the two companies said. Osaka-based Takeda needs new drugs and research capacity because its biggest seller, the diabetes drug Actos, faces patent expiration in 2011.[35]
Takeda's sudden and lucrative takeover bid of 25 per share - about 53 percent above Millennium's closing price on Wednesday - took some local business leaders by surprise yesterday. "It's always nice to see a local company" stay independent, said Andre Mayer, economic research director at the Associated Industries of Massachusetts. He added Takeda clearly wants to tap into Boston's rich biotech talent pool - as well as get control of Millennium's cancer drug Velcade, considered a potential blockbuster for the company.[23]
Takeda, the world's 17th-largest pharmaceutical company, said the deal could create a "powerful new drug development engine," giving it rights to Millennium's fast-growing cancer drug, Velcade, and access to a rich pipeline of cancer and anti-inflammatory drugs in development. Company executives said they plan to operate Millennium as a separate business unit, retaining its name, management team, and workforce of about 1,000, including 800 at its Cambridge headquarters. "It is very important for us to stay and drive the business forward," said Millennium chief executive Deborah Dunsire, who said she planned to stay with the company for at least a year.[25] Millennium climbed $7.99, or 49 percent to $24.34, at 4 p.m. New York time in Nasdaq Stock Market composite trading. Takeda, based in Osaka, needs new drugs and research capacity as its biggest seller, the diabetes drug Actos, faces patent expiration in three years. "This deal will boost Takeda's drug-development flow,'' said Mitsuo Ohmi, a Tokyo-based analyst at Japan Advisory LLC. "Millennium is a leader in genome medicine, with some promising drugs in early development.''[36] Takeda's proposed $25-a-share buyout affirms Velcade's resurgence and Millennium's steadily progressing biologics drug pipeline. The Millennium deal is expected to close sometime this quarter. Takeda has been making a lot of bets in oncology and biotech recently, like its deal with Cell Genesys (Nasdaq: CEGE ) last week for its prostate cancer immunotherapy compound, which is in phase 3 trials. Over the past two years, biopharmaceutical assets have been hot commodities, compared with their small-molecule drug peers.[34] Takeda also got an exclusive right to develop and globally market Cell Genesys Inc.s prostate cancer vaccine. Takeda said Millenniums key product, a blood cancer drug Velcade, is expected to rake in revenue of as much as US$345 million this year. Millennium President and CEO Deborah Dunsire said that both companies aim to develop breakthrough medicines and become a global leader in oncology. "We expect this transaction to help accelerate that vision and deliver tremendous value to patients, shareholders and our employees," Dunsire said in a statement.[37] Takeda currently specializes in treatments for diabetes and cardiovascular problems. Millennium's top drug is the blood cancer treatment Velcade, which is expected to generate revenue of $345 million this year.[38] Millennium's key drug is the blood cancer treatment Velcade, which had sales of $83.5 million in the first quarter, up 42 percent from a year ago, above analysts' estimates. Velcade sales are expected to reach $345 million this year.[5] NEW YORK (Associated Press) - Biotechnology company Millennium Pharmaceuticals Inc. said Thursday sales of its blood cancer treatment Velcade rose 42 percent during the first quarter to $83.5 million.[39]
"Millennium's contribution to earnings in the short to medium term will not be not be very large, making it difficult to overlook the premium the company is paying," said Merrill analyst Masatake Miyoshi in a copy of a report obtained by Reuters. Millennium believes Velcade, which garnered global sales of $800 million last year, will achieve blockbuster status of well over $1 billion in its current uses. It is jointly marketed in the United States with Johnson & Johnson (JNJ.N: Quote, Profile, Research ), which also markets the drug in other countries.[9] The combined company is expected to maximize the clinical, regulatory and commercial potential of the three approved therapies for hematology/oncology, which have been brought together. The company noted that the deal furthers its strategy of becoming a global leader in hematology/oncology field. In a separate statement on Thursday, Millennium announced that its first quarter U.S. net sales of VELCADE was $83.5 million that surged 42% from the previous year, and 13% from the sequential fourth quarter, significantly exceeding the U.S. Wall Street analyst consensus estimate.[22] The deal is projected to accelerate Takeda's vision of becoming a global leader in oncology. Separately, Millennium said its first-quarter U.S. net sales of its flagship product VELCADE surged 42%, significantly above Wall Street analysts' consensus estimate.[22] "Velcade will be a blockbuster in short order," said Millennium President and CEO Deborah Dunsire during a conference call. Takeda President Yasuchika Hasegawa told investors he believes Velcade will achieve sales of more than $1 billion just in its current indications. Cowen and Co. analyst Rachel McMinn said in a research note that the deal was intended by Takeda to "strengthen its oncology franchise. strengthen its R&D; presence in the U.S. strengthen its GI franchise with MLNM's monoclonal antibody alpha4beta7 MLN0002 for ulcerative colitis and Crohn's disease."[33]
UBS advised Takeda, while Goldman Sachs advised Millenium. Last month, UBS Securities Japan analyst Hirohisa Shimura described Takeda, which has a market value of about $48 billion, as being very well positioned in terms of "strategic financing," with enough funding to make such acquisitions. Though the price tag is hefty, in the high finance world of drug makers, the deal amounts to a bolt-on acquisition for Takeda, increasing its exposure in the lucrative U.S. drug market and plugging a gap in its product line.[16] Takeda's acquisition of Millennium for $8.8 billion will extend the Japanese drug maker's presence in oncology and help stem the loss of revenues as key drugs go generic.[40] Japanese drug maker Takeda Pharmaceutical Co. said it would buy the company for $8.8 billion.[41] TOKYO (AP) - Japan's top drug maker is paying $8.8 billion for Cambridge-based biotechnology company Millennium Pharmaceuticals.[38] Takeda Pharmaceuticals, Japan's largest drug maker, will acquire Millennium Pharmaceuticals MLNM in an almost $9 billion transaction that significantly expands its presence in the United States, the companies announced Thursday morning.[42]
Takeda, Japan's biggest drug maker by revenue, will buy Millennium, which is based in Cambridge, Mass., for $25 a share.[11] Takeda will pay $25 a share in cash for Millennium, which is based in Cambridge, Mass. The price represents a 53% premium to Millennium's closing price of $16.35 a share Wednesday.[42] Takeda announced the offer late Wednesday, which works out to about $25 per share, or 53 percent above Millennium's closing price of $16.35 that day.[5] The Osaka-based company will launch a tender offer of $25.00 per share, a 53 percent premium to Millennium's closing price on April 9 of $16.35.[43]
The $25 per share deal represented a 53 percent premium to Millenniums closing price Wednesday. It immediately set off speculation that other U.S. biotechnology companies might be acquired at high valuations, particularly by non-U.S. companies that can take advantage of the weak dollar.[44] Japan's largest drugmaker is buying Millennium, and its lucrative Velcade multiple myeloma product, in an all-cash deal for $25 a share, a hefty 53 percent premium to Wednesday's closing price.[33] Stockholders of Cambridge, Massachusetts-based Millennium will receive $25 a share in cash, 53 percent more than the April 9 closing price before the deal was announced, the two companies said.[17]
Takeda agreed to pay $25 a share in cash, or 53 percent above Millennium's closing share price on Wednesday of $16.35.[10] Takeda offered $25 per share, 53 percent higher than Millennium's closing stock price on Wednesday.[25]
The stock surged 48.9 percent Thursday, finishing at $24.34. Christopher Raymond lowered his rating to "Neutral" from "Outperform," as shares are close to Takeda's buyout price. He said the deal is likely to be completed and there is little room for the stock to rise soon. He added that Millennium will have to pay a $247 million breakup fee if it backs out of the deal, which makes it unlikely that competing bids will be made.[45] Shares jumped toward the offer price in heavy morning trading, climbing $8.14, or 49.8 percent, to $24.49. The stock peaked at $24.50, its highest price since March 2002. BMO analyst Jason Zhang said he thinks Millennium shareholders will accept the offer and thinks the deal will win regulatory approval.[28]
Millennium shares rocketed 48.9 percent yesterday to $24.34, up $7.99, the highest level in four years. The stock is still below its peak in late 2000, when investors thought Millennium was going to be one of the leading biotechs of the new century, sending its share price to more than $80 and making the company worth about $18 billion.[25] "Takeda has been sitting on a pile of cash,'' said Samuel Isaly, a managing partner at Orbimed Advisers LLC in New York, who oversees the Eaton Vance Worldwide Health Sciences Fund with $1.5 billion under management and owns 3 million Millennium shares. "It represents something like a quarter of their market value and they get close to zero return on it in terms of the rate of interest paid,'' said Isaly. His fund sold Takeda stock during "the last couple of months because of the patent cliff'' facing the drugmaker, he said.[17]
NEW YORK -- A Baird analyst says Takeda Pharmaceuticals' buyout of Millennium Pharmaceuticals will go through, but said Millennium stock is likely to stay near its current price and downgraded its shares.[45]
The acquisition of Millennium also follows a decision to end a three-decade partnership with U.S. drug company Abbott Laboratories (nyse: ABT - news - people ). The two companies agreed to split their American joint venture, with Takeda taking the bigger slice, including its R&D; operations, as well as the candidate treatments in its pipeline. A decade ago, Takeda did no business in North America; in the fiscal year that ended in March 2007, the region accounted for 33% of its sales.[31] According to earlier reports, the conversion of the JV into a unit would lift Takeda's worldwide sales to 1.7 trillion yen, with a global rank of 14, higher than current 17, and half of Takeda's total sales would be from the U.S, where the company aims to launch a series of new products to boost sales. The company was also aiming for mergers and acquisitions inside and outside Japan, putting its cash reserves of 1 trillion yen or so to use. The U.S. drug market, roughly worth 28 trillion yen, has been growing around 10% a year, and it's easier to develop and test new drugs in the U.S. than in Japan, where the market has been stagnant.[22]
"We believe the deal, the largest for the company, is an extremely important investment to ensure our sustainable growth in the future." Japan's largest drugmaker by sales has struggled to stay competitive, aggressively expanding ties with U.S. drug makers, particularly those that focus on cancer. Ranking 17th among global drug makers, Takeda is attempting to head off a loss in revenue as its patents expire on key drugs.[6] Takeda, Japan's largest drug maker by sales, has specialized in treatments for diabetes and cardiovascular problems. Ranked 17th among global drug makers, it has struggled to stay competitive while attempting to head off a loss in revenue as its patents expire on key drugs. It has recently been expanding ties with U.S. drug makers, especially those that focus on cancer treatments.[5]
The all-cash deal comes as Takeda, Japan's biggest drug maker by revenue but ranked only 17th in global terms, digs deep into a bulging cash pile to find new ways to tackle rapidly approach patent expirations for key drugs like its blockbuster Actos diabetes treatment.[16]
According to Millennium, the deal is expected to speed up Takeda's vision of becoming a global leader in oncology in the areas of oncology discovery, development, regulatory affairs and commercialization. With their combined research, development and commercialization capabilities, they will have the potential to create a powerful new drug development engine and accelerate the potential of an emerging drug pipeline.[22] Millennium has more than a half billion dollars in revenue last year and also has a number of inflammation and cancer therapies in the pipeline, which would also address Takeda's interest in oncology. "Millennium greatly strengthens Takeda's global oncology portfolio, led by the flagship product Velcade, and further enhances its pipeline with clinically differentiated, high-quality product candidates," said Yasuchika Hasegawa, President of Takeda.[46] Half of the stake of the Illinois-based joint venture, created in 1977, was reportedly estimated to be worth between 300-500 billion yen. Following the completion, Takeda said it plans to integrate TAP into two of its wholly-owned U.S. subsidiaries, Takeda Pharmaceuticals North America, Inc. and Takeda Global Research and Development Center, Inc. In 2007, TAP had revenues of $3.1 billion from its two currently marketed products, Prevacid, a peptic ulcer treatment, and Lupron, a treatment for prostate cancer and endometriosis.[22] Takeda recently agreed to buy Amgen Inc's (AMGN.O: Quote, Profile, Research ) Japanese subsidiary. Last month it said it might pay Abbott Laboratories Inc (ABT.N: Quote, Profile, Research ) up to $1.5 billion under an agreement to split their U.S. joint venture TAP Pharmaceutical Products, which would give Takeda the blockbuster heartburn drug Prevacid.[10]
The pact represents a rare acquisition by a Japanese drug company of a U.S.-based pharmaceutical concern and its value is more than double the value of Eisai Co.' s acquisition last year of cancer company MGI Pharma Inc. for $3.9 billion. It could also signal more visibility in the U.S. for Takeda, which, like its home-country rivals, generally has kept a low profile in the world's biggest drug market.[11] Takeda's acquisition of Millennium is just one of several bold moves made by the Japanese drug maker recently. The company ended its U.S. joint venture with Abbott Labs ABT and acquired Japanese rights to more than a dozen early-stage drugs in Amgen's AMGN pipeline.[42] Associated Press - April 10, 2008 1:44 PM ET TOKYO (AP) - Japan's top drug maker has announced an $8.8 billion acquisition of Cambridge-based biotechnology company Millennium[38] Japan's drug makers, though collectively worth more than $100 billion by market capitalization, are relative minnows when stacked against giants like Pfizer Inc., GlaxoSmithKline PLC and Roche Holding AG; so, for the Japanese, fast and innovative growth drivers - via new technology and reorganization as well as mid-level acquisitions - are now top of the agenda.[16]
For all the complaints about the FDA, drug development in Japan is a much slower and more painful process. Thanks to a system where drugmakers pay when their medicines are approved, the FDA has 10 times as many drug reviewers as its Japanese equivalent. Takeda has also been under pressure to pull off a big acquisition due to the upcoming expiration of its U.S. patents on the ulcer treatment Prevacid in 2009 and Actos, the world's best-selling diabetes drug, in 2011. It needs to develop or acquire new treatments and build up sales before generic versions of Prevacid and Actos gain traction.[31]
Buying Millennium will bolster sales in the U.S., Takeda's fastest-growing market. Revenue rose 1.7 percent in the quarter ended Dec. 31, the slowest pace in at least four years, on flagging demand for its prostate and stomach ulcer drugs. Millennium, led by Chief Executive Officer Deborah Dunsire, earned $14.9 million in net income, its first profit since 1998, according to data compiled by Bloomberg.[17] Millennium said sales of Velcade totaled $83.5 million in the first quarter, up 42 percent from the first quarter of 2007. The company's pipeline includes a treatment for inflammatory bowel disease which is expected to go into Phase III clinical trials late this year or early 2009.[12] Millennium said yesterday that Velcade generated about $800 million in worldwide sales last year. Its partner, Johnson & Johnson, markets the drug in 85 other countries.[25] Last year, Velcade sales outside the U.S. were more than $500 million, Millennium said. J&J; paid Velcade royalties of about $80 million on those sales, Millennium said.[32] In conjunction with the acquisition, Millennium pre-announced first-quarter Velcade U.S. sales of $83.5 million, a 13% increase over fourth-quarter 2007 sales and a 42% increase year over year. In Europe, Velcade is marketed by Johnson & Johnson JNJ, with Millennium receiving royalties on those sales.[42]
Dr. Dunsire, who joined Millennium in 2005, said Mr. Hasegawa moved quickly once it became apparent a licensing partnership, the original idea, could be expanded upon. The discussions accelerated over the past three weeks, she said. She said Millennium wasn't looking for an acquirer and had recently become profitable. "This was not part of our business plan going forward," she said of the purchase. With $891 million in cash on hand at the end of the year, Dr. Dunsire said the company was well funded to explore deals of its own. Dr. Dunsire said she and her management team would stay on after the acquisition and that Millennium will operate as a stand-alone business.[11] The acquisition, which grew out of a visit Millennium Chief Executive Deborah Dunsire paid to Takeda in July, is part of an aggressive campaign by Takeda President Yasuchika Hasegawa to spend a good chunk of the roughly $20 billion the company has in cash on acquisitions or licensing agreements.[11] Dr. Deborah Dunsire, Millennium President and Chief Executive Officer, and the current management team will continue with the company after sale. Takeda will finance the acquisition through cash on hand, and expects that the acquisition will enhance its earnings starting in the fiscal year 2010 before transaction related amortization.[21] Millennium will be known as Millennium Pharmaceuticals, Inc., a Takeda Company. Takeda expects the acquisition to enhance its earnings starting in the fiscal year ended March 2010 before transaction related amortization.[29]
Millennium will be known as Millennium Pharmaceuticals Inc., a Takeda Company, according to a statement from the firms. The transaction was unanimously approved by the boards of directors of both companies. Millennium is best known for its product Velcade, a treatment for some types of cancer.[26]
Millennium is best known for the cancer drug Velcade, which Takeda is looking to turn into a global blockbuster. That would go a long way toward overcoming the looming patent expirations for Actos and Prevacid.'' Recently Takeda and Abbott split up their long-time drug development partnership. That move boosted Takeda to the fourteenth largest drug company in the world, but investors have been fretting over the absence of a big takeover.[46] In the Millennium deal, Takeda will get Velcade, an injectable drug primarily used as a second-line treatment for rare blood cancers after other therapies have failed.[35] "Velcade will be a blockbuster in short order,'' Dunsire, who joined Millennium in 2005, said today in a conference call with investors. Takeda wants to strengthen its cancer business, "where we had a slow start in sales and in getting sufficient compounds into the pipeline,'' Takeda President Yasuchika Hasegawa told reporters in Tokyo today. He said Takeda will provide details on the deal's impact on earnings when the drugmaker reports results on May 9.[32] Upon completion of the deal, Millennium will become a wholly owned subsidiary of Takeda and will continue operations in Cambridge as a standalone business unit and will keep the Millennium name. During a conference call with investors this morning, Takeda officials said that it would keep Millennium's executive team and Millennium CEO Deborah Dunsire would become president of the subsidiary and report directly to Takeda president Yasuchika Hasegawa.[2]
The agreement calls for Cambridge, Mass. -based Millennium (Nasdaq: MLNM) to be taken private through a cash tender offer of $25 per share and become a wholly-owned subsidiary of Takeda as a standalone business unit.[26] The cash offer is worth $25 per share, more than a 50 percent premium over Millennium's Wednesday closing share price of $16.35.[6] Takeda's per share bid price represents 52.9% premium on $16.35, Millennium's closing share price on Wednesday.[22]
Takeda announced plans to acquire the Cambridge, Mass. -based biotech April 10 for $25 per share, a 53 percent premium over the April 9 closing price.[40] Stockholders of Cambridge, Mass. -based Millennium will receive $25 a share in cash, 53% more than Wednesday's closing price, the two companies said.[24]
Takeda has arranged to purchase Cambridge, MA-based Millennium for $25 a share, or a total of $8.8 billion.[7] Takeda agreed to buy Millennium for $8.8 billion, or $25 per share, late Wednesday.[45]
Looking to expand out of a budget-bound Japanese market, Takeda is taking a big chunk of its $10 billion war chest and offering $8.8 billion in cash for U.S.-based Millennium Pharmaceuticals.[46] Late Wednesday, Japan-based Takeda Pharmaceutical Co. announced an $8.8 billion cash bid for Millennium.[39] Japan's Takeda Pharmaceutical offered $8.8 billion in cash for the drugmaker.[47]
In the next few years, Takeda will lose patent protection on a pair of blockbusters, Prevacid (for heartburn) and Actos (for diabetes). The company's president, Yasuchika Hasegawa, has pledged to tap the company's $20 billion cash pile to buy his way out of trouble, the WSJ notes. He's been peeling some big bills off the wad lately. Earlier this year, the company bought Amgen's Japan unit, and landed marketing rights to several Amgen drugs for Japan and Asia. The company bought its way out of a joint venture with Abbott Labs.[14] The company is dipping into cash reserves for a shopping spree. In February, Takeda struck a deal to buy biotech giant Amgen Inc.' s Japanese unit and obtained licensing rights for a number of its cancer drugs in Asia.[6] In February it struck a deal with biotech giant Amgen Inc. for that company's Japanese unit and licensing rights for a number of cancer drugs in Asia. Other deals for Takeda include rights to market Cell Genesys Inc.' s prostate cancer vaccine.[5]
In February, it agreed to pay Amgen Inc., of Thousand Oaks, Calif., potentially more than $1 billion for Japanese rights to 13 molecules, including the FDA-approved colorectal drug Vectibix (panitumumab). In March, Takeda and Abbott, of Abbott Park, Ill., ended their 31-year joint venture for TAP Pharmaceutical Products Inc., with Takeda taking over TAP and the companies splitting up its products.[33] In February, Takeda brokered a deal to purchase Amgen's Japan unit and gain marketing rights to 13 Amgen drugs for Japan and Asia. In March, Takeda bought out partner Abbott Laboratories in its TAP Pharmaceuticals joint venture. Takeda is Japan's largest drugmaker in terms of revenue but is staring at looming patent expiration on its biggest-selling products ''' the proton pump inhibitor Prevacid which expires in 2009, and diabetes treatment Actos, which will see expiry in 2011.[7] TAP has two new drug applications under review at the U.S. Food and Drug Administration, or FDA. Under the deal, Abbott would receive rights to Lupron, including the commercial organization supporting that franchise, and will receive payments based on TAP's other current and certain future products, while Takeda would receive the rights to the product Prevacid, all the remaining TAP commercial and support organizations, and the rights to TAP's pipeline.[22]
Cambridge, Mass. -based Millennium's mainstay product is the blood-cancer drug Velcade, which Takeda believes has the potential to be a worldwide blockbuster. Millennium also has a healthy pipeline of oncology and anti-inflammatory candidates, including a therapy for inflammatory bowel disease that's on track to enter Phase 3 clinical trials later this year or by early 2009.[31] Besides current and future products, Takeda said it expects to gain a seasoned management team - with Dunsire remaining at the helm and Millennium's expertise in the research area of protein homeostasis, and an experienced sales force. Overall, Takeda gains an enriched pipeline, an important matter considering two of its biggest sellers, Prevacid in gastric reflux disease and Actos in diabetes, come off patent in 2009 and 2011, respectively. "Millennium greatly strengthens Takeda's global oncology portfolio. and further enhances its pipeline with clinically differentiated, high-quality product candidates," Hasegawa said in a statement.[33] Dr. Deborah Dunsire, Millennium's chief executive and a former leader of cancer research at Novartis, will lead Takeda's global oncology development.[24]
With the acquisition, Takeda expects to get access to a fully-integrated oncology discovery, development and commercial platform, add VELCADE with near- term worldwide blockbuster potential, and supply access to Millennium world-class drug discovery organization, including expertise in the novel research area of protein homeostasis.[22] The acquisition will give Takeda control of Millenniums cancer drug Velcade, which is used to treat multiple myeloma, a blood cancer.[44] In-house, genomics-based innovation never quite panned out the way Millennium's founders envisioned. The biotech got hold of its first approved drug, Campath (now owned by Genzyme), and its one currently marketed product, the cancer drug Velcade, in the 1999 acquisition of Leukosite.[13] Johnson Johnson has the marketing rights for the drug outside the United States. Takeda, based in Osaka, Japan, has been aggressive in acquisitions and licensing of products, in part to prepare for the loss of patent protection in the next few years of Actos, its diabetes drug, and Prevacid, for ulcers. It is making a particular thrust into the cancer area.[44] The $8.8 billion acquisition Takeda announced yesterday gives Japan's largest drugmaker only one product on the market: the blood-cancer medicine Velcade.[17]
Takeda recently agreed to acquire Millennium in a deal worth about $8.8 billion.[43] Takeda has been sitting on over $100 billion and an acquisition like the Millennium deal is seen by many.[8] Investors have long expected a major acquisition by Takeda. Disappointment that it had not yet struck a deal led to a drop in its share price from 6,570 yen ($65.27) in late 2007 to about 5,000 yen ($49.67) in the first quarter.[31]
Takeda's offer is significantly higher than the 12-month target price of any analyst covering Millennium shares. According to Thomson Financial, their targets ranged from $9 to $20 per share, with an average of $16.27.[28] Shares of Millennium quickly rose to within the range of Takeda's offer price, surging nearly 50 percent to $24.42.[5]
Millennium, the Cambridge, Massachusetts-based biopharmaceutical company, noted that the transaction is structured as an all-cash tender offer for all of Millennium common stock, followed by a merger in which remaining shares of Millennium would be converted into the right to receive the same US$25 cash per share price paid in the tender offer.[22] Takeda will spend $25 per share in cash for the Cambridge, Mass. -based company.[20]
Millenniums shares have not been above $25, the price Takeda will pay, since around the end of 2001.[44]
Takeda's cash bid is a premium of 52.9 percent to Millennium's Wednesday closing price of $16.35.[28] The price represents a 53% premium to Wednesday's $16.35 closing price for Millennium shares.[11] The price represents a sweet 53% premium to Wednesday's $16.35 closing price for Millennium's stock, the Wall Street Journal reported.[7]
Shares of Millennium soared 49% on the news, closing up $7.99 to $24.34 as of 4 p.m. Nasdaq Stock Market composite trading.[11] Shares, however, soared 49 percent, or $8.10, to $24.46 in early trading Thursday. Millennium President and CEO Deborah Dunsire said that both companies aim to develop new medicines. "We expect this transaction to help accelerate that vision and deliver tremendous value to patients, shareholders and our employees," Dunsire said in a statement.[6] Investors jumped at the news. Shares of Millennium (NASDAQ:MLNM) shot up $7.99, or 49 percent, to close slightly under the purchase price at $24.34, it's highest price since 2002.[33] Isaly placed a bet on Millennium at just the right time. He said one of his funds, the Eaton Vance Worldwide Health Sciences Fund, owned more than 2 percent of the shares outstanding at an average price just above $10.[41]
"I think the lag time is probably longer than eight years." Nobody did more to raise those unrealistic expectations than Mark J. Levin, Millennium's cofounder and longtime chief executive. In December 2001, he told Technology Review that Millennium would use ge nomics to become wildly successful. He said: "Over the next five to 10 years, our goal is to become a company that's leading the world in personalized medicines, a company that is leading the world in productivity, a company with a value of over $100 billion, a company that has five to 10 products on the market that are making a big difference in people's lives, a company with the strongest pipeline in the entire industry."[41] Analysts believe it will soon deliver billions of dollars in annual sales, making it a blockbuster treatment. The drug, now used to treat multiple myeloma, a form of cancer, is undergoing trials to treat other types of cancer, such as non-Hodgkin's lymphoma. Analysts give the company credit for developing a promising pipeline of other cancer and anti-inflammatory drugs, though they are generally years away from being approved for sale.[25] The company's current and forecast sales were part of the appeal for Japan's top drug maker Takeda Pharmaceutical Co.[43] Japanese drug maker Takeda Pharmaceutical Co. said it would buy the company.[41] The deal could be a boon to Takeda's global presence given the Japanese drug maker already operates a fast-growing subsidiary, Takeda Pharmaceuticals North America Inc., located in the north Chicago suburb of Deerfield.[19]
The deal was announced after the close of trading in Japan. The purchase comes as many of the world's largest pharmaceutical concerns are exploring deals for companies and drugs that will boost their own flagging pipelines. Many drug makers face a dearth of promising drugs under development and the prospect of the expirations of the patents for many of their biggest-selling medicines. This situation has many of them casting about for revenue sources to make up those gaps.[11]
Prevacid's patent expires in 2009. "This deal will boost Takeda's drug-development flow," said Mitsuo Ohmi, a Tokyo-based analyst at Japan Advisory LLC. "Millennium is a leader in genome medicine, with some promising drugs in early development."[35] "Millennium is a leader in genome-based drug discovery with promising drugs in early development,'' said Mitsuo Ohmi, a drug analyst at Japan Advisory LLC. "However, Takeda still needs to do a little more to fully cover the loss of sales once Actos's patent expires.''[17]
The Millennium deal will also help Takeda continue to diversify beyond Japan, where the drug regulatory process can be slow.[14] Takeda has surprised the folks at Millennium with a buyout offer. (They're battening down the hatches over in Japan, and looking for something new). I know several people over at the latter company, and I can imagine that yesterday was one of the less productive days around the labs. No doubt there was a lot of initial fear that this would be a Pfizer-style deal (see below), but as the day went on that didn'''t seem to be the case.[48] In the merger that follows completion of the tender offer, Mahogany Acquisition will be merged into Millennium, and the surviving entity will be an indirect wholly-owned subsidiary of Takeda, the largest pharmaceutical company in Japan.[22] Takeover: Cambridge's Millennium Pharmaceuticals, above, will remain a standalone subsidiary of Japan's Takeda Pharmaceuticals whose offer shocked the Boston business community.[23] Upon completion of the acquisition, Millennium will become a wholly owned subsidiary of Takeda Pharmaceutical Company Limited, and will continue operations in Cambridge, Massachusetts, as a standalone business unit.[29]
April 11 (Bloomberg) -- Takeda Pharmaceutical Co. shareholders may not be satisfied with the purchase of Millennium Pharmaceuticals Inc. because the company won't gain enough new revenue to counter generic competition to its best-selling Actos diabetes pill.[17] Takeda President Yasuchika Hasegawa, at a news conference Thursday in Tokyo, discussing the company's plan to acquire Millennium Pharmaceuticals.[11]
Millennium sold for $8.8b to Japanese drug firm Boston.com Millennium Pharmaceuticals Inc., one of the Bay State's best known biotech companies, is being sold.[3] The genomics revolution was not a flop. It just needs more time. Millennium Pharmaceuticals Inc., the Cambridge biotech firm that came to symbolize the genomics breakthroughs of the past 10 years, was never able to both develop and market a single drug using its genomic expertise.[41] Cambridge, Mass. -based Millennium Pharmaceuticals Inc. sells drugs including Velcade, a drug used to treat multiple myeloma and lymphoma.[28]
John Maraganore, who worked as a Millennium executive from 1997 to 2002, said the deal could potentially free Millennium from worries about making every quarter's profit figures, allowing it to invest more money in drug development. "They can now realize their full potential," said Maraganore, now chief executive of Alnylam Pharmaceuticals Inc. in Cambridge. Dunsire said she expects the deal to be completed in June.[25]
Beyond building lavish headquarters and striking licensing deals worth hundreds of millions of dollars to Millennium, the company didn't produce. Its two cancer-fighting drugs, Campath and Velcade, came about the old-fashioned way: Millennium bought the smaller companies that developed the drugs. Millennium has since sold its rights to Campath to Genzyme Corp.[41] Yesterday's deal highlights the company's success with Velcade, a cancer drug discovered by a company that Millennium purchased.[25]
The deal would give Takeda access to Millennium's Velcade cancer treatment. Genentech ( DNA ) added 0.73 to 78.44 ahead of its earnings after the close.[47]
Osaka-based Takeda, which has strength in the diabetes, anti-infectives and cardiovascular spaces, adds to that portfolio Velcade (bortezomib), one of the up-and-coming stars of the industry. It is approved for use in rare blood cancers where other treatments fail, and is expected to take in from $320 million to $345 million this year for that indication.[33] Velcade, for rare blood cancers, generated more than $800 million last year as a treatment after other drugs fail.[32]
Sales of Velcade in the United States reached $83.5 million in the first quarter of 2008, up 42 percent from a year earlier, in part because of new data showing the drugs effectiveness.[44] Velcade generated more than $800 million in sales last year and some analysts see it as a future blockbuster that could generate more than $1 billion in worldwide sales.[35]
Velcade can generate annual sales of $1 billion in the U.S. and $2 billion worldwide, Baird said. "For Takeda, the logic has to have been wait until the positive Velcade data came out and the front-line approval was assured then get in at the start of this sales trajectory,'' Baird said.[32]
The Nasdaq Biotechnology Index as a whole rose 3.5 percent. Takeda, Japan's largest drugmaker, has long been under pressure to use its $10 billion war chest to strengthen its pipeline before a U.S. patent on its top-selling diabetes drug, Actos, expires in 2011.[10] The cash offer wasn't difficult for Takeda, since it reports having $20 billion in cash. This is the second billion-dollar deal Takeda has made with a U.S. biotech in slightly more than two months.[33] The total value of the deal is $8.8 billion, which Takeda will finance through cash on hand.[42] The deal is worth $8.8 billion. Shares of the biotech free fall on fears its lead drug candidate may never make it to market.[42]
The climb came on news that the company will be acquired by Takeda (TKPHF.PK) for about $8.8 billion.[29]
In February, Takeda agreed to spend as much as $1.2 billion to acquire Amgens Japanese unit and the rights to up to 13 of Amgens experimental drugs for cancer and other diseases.[44] Takeda, whose 1.3 trillion yen ($12.77 billion) in sales is 41% more than No. 2 rival Astellas Pharma Inc.' s, specializes in diabetes, cardiovascular and anti-infective drugs.[11]
Millennium struck about 20 alliances with other drug companies, which collectively paid Millennium a total of about $2 billion to provide leads for new drugs.[44] Millennium expects to win U.S. approval to sell Velcade as an initial therapy by June. Takeda needs new drugs and an improved pipeline because its biggest seller, the diabetes drug Actos, faces patent expiration in 2011.[19] Johnson & Johnson, based in New Brunswick, New Jersey, will continue to market Velcade outside the U.S. under a co- development agreement with Millennium until the drug's patent expires, said Marsha Fanucci, Millennium's chief financial officer, in an interview.[32]
Millennium's flagship product is VELCADE, used for the treatment of patients with relapsed multiple myeloma, approved in more than 85 countries, and is co-developed with Johnson & Johnson Pharmaceutical Research & Development, L.L.C. Millennium is responsible for commercialization of VELCADE in the U.S. and Janssen-Cilag is responsible in Europe and the rest of the world, while Janssen Pharmaceutical K.K. markets the product in Japan.[22] Goldman, Sachs & Co. is acting as exclusive financial advisor and WilmerHale is acting as legal advisor to Millennium. In a separate deal, on March 19, Takeda said it agreed to conclude its 50/50 U.S. joint venture, TAP Pharmaceutical Products Inc, with drugmaker Abbott Laboratories (ABT) by buying the 50% stake of Abbott.[22]
Japanese companies, aided by the dollar's 15 percent decline against the yen in the last 12 months, are seeking growth abroad to counter Japanese government price cuts and a shortage of new medicines from research operations. Takeda, which traces its origins to a medicine wholesale business opened in Osaka in 1781, hasn't released a product in the U.S. since the sleeping pill Rozerem in September 2005.[17]
Takeda said it would begin the purchase process of Millennium within five business days and complete it within 20. Takeda has been aggressively expanding its business ties recently with U.S. drugmakers that are strong in cancer drugs.[37] "The area of cancer treatments, in which Millennium is particularly strong, is one of our companys most important areas of research and development," Takeda said in a statement.[37] Millennium also has seven compounds in clinical trials, or tests on human subjects. Its most-promising treatment is for Crohn's disease, an intestinal disorder that can cause severe stomach pain and serious bleeding. The medicine, an antibody that works by binding to cells believed to play a role in the genesis of inflammatory-bowel diseases such as Crohn's, is slated to begin final-stage testing later this year. Other drugs in development include treatments for cancer and multiple sclerosis.[11] Millennium had returned to profitability only recently, and sales of Velcade have been on the rebound after very positive new clinical trial results in early stage multiple myeloma patients and for other related indications last year. Velcade sales were up 42% year over year in the U.S. in the first quarter this year, for example.[34] The arrangement would survive a Takeda purchase, Fanucci and J&J; spokesman Marc Monseau said. A separate agreement with J&J; to use its sales force to promote Velcade in the U.S. will expire at the end of this year unless both parties agree to renew it, Fanucci said.[32]
Takeda shares dropped 110 yen, or 2 percent, to 5,300 yen today and have plunged 33 percent the past year, even as Hasegawa announced plans to buy back as many as 34 million shares, made three acquisitions and increased dividend payments. Masatake Miyoshi, a Tokyo-based equities analyst at Merrill Lynch Japan Securities lowered to his recommendation on Takeda to "sell'' from "buy'' today. [17] If certain conditions aren't met, the company said it can extend the buying period through October. Meanwhile in a sign of the company's willingness to splash out to appease shareholders in the short-term, Takeda said it would buy back up to 1.24%, or 11 million, of its outstanding shares for up to Y60 billion. Its shares ended the day 2.5% lower at Y5,410, giving it a market capitalization of Y4.8 trillion, while the Nikkei index of blue chips slipped 1.3%.[16]
In the all-cash tender offer, Takeda is buying the Cambridge, Massachusetts-based company for US$25 (15.90) a share, the Japanese company said in a statement.[37] Shares rose $7.99, or 48.9%, to $24.34. Shares of Yahoo! YHOO gathered steam following a report in the Wall Street Journal that it may be close to merging its online operations with Time Warner's TWX AOL in a bid to rebuff Microsoft's MSFT unsolicited offer for the company.[30] The $25 per share offer is a 65 percent premium over Wednesday's close.[46]
Millennium shares closed Wednesday at US$16.35, meaning that Takeda is paying a 53 percent premium for the shares.[37]
Millennium Pharmaceuticals Inc. shares edged up 6 cents to $24.40 in premarket electronic trading.[45] Biopharmaceutical company Millennium Pharmaceuticals Inc. (MLNM) engages in the discovery, development and commercializing of medicines for cancer, inflammatory bowel, and other inflammatory diseases in the United States.[43]
Back in the late 1990s Millennium was at the vanguard of the so-called genomics revolution, which promised to turn genetic information into new drugs faster than ever before. Millennium's internal drug development pipeline never delivered on its potential and the company saddled itself with a bloated expense ledger.[42] Velcade, the company's most successful drug to date, was acquired from an outside company. Millennium did manage to start turning the company around in 2006 and 2007 by sharply reducing costs and better managing its drug development pipeline.[42]
After racking up persistent losses, the company gradually decided to make the switch from research to drug development. The transition was sometimes painful, forcing Millennium to shed hundreds of jobs and narrow its focus. Like many biotechs, many of its promising drugs in development ultimately failed.[25] Millennium was once one of the highest-flying biotech firms on Wall Street. The company generated a lot of buzz with its research of a potential obesity drug that purportedly worked by boosting fat burning.[11]
The biotech industry could see a resurgence of merger and acquisition activity, with BioMarin and Human Genome Sciences as potential targets. Millennium's cancer drug rival Celgene Corp. could see more competitive pressure for its drug Revlimid, Raymond said. AP Writer Mari Yamaguchi in Tokyo contributed to this report.[5] The deal also marks the second major U.S. biotech acquisition by a Japanese drug maker in the last few months, as cash-rich Japanese firms look for opportunities to take advantage of the weak U.S. dollar.[25] In February, Takeda struck a deal to buy biotech giant Amgen Inc.' s Japan unit, as well as gain marketing rights to 13 Amgen drugs for Japan and elsewhere in Asia.[11] Takeda is playing defense with its high cash position. The reason for the very high premium is simple: Big pharma & bio are facing generic competition, weak pipelines and lower pricing power for their "me-too" drugs going forward.They have no choice but to continue doing deals (partnerships and acquisitions)to grow and justify their valuations.[14] The deal comes as Japans largest drugmaker, which ranks only 17th globally, struggles to stay afloat amid growing competition. Osaka-based Takeda, which specializes in "lifestyle-related diseases" such as diabetes and cardiovascular problems, said it can acquire a new strength in cancer treatments through the deal.[37] Late last year Eisai Co Ltd (4523.T: Quote, Profile, Research ) agreed to acquire cancer specialist MGI Pharma Inc for $3.9 billion; the deal was completed in January.[10] The drug generated more than $800 million last year, compared with $3.4 billion for Actos, the company'''s best- selling diabetes pill.[18] Last year, the company set aside $10 billion as part of a strategic fund to help it expand into overseas markets.[11]
Last year, new clinical data supporting the use of Velcade in first-line multiple myeloma patients helped boost the company's outlook and its share price.[42] After that, with rival drugmaker Celgene (Nasdaq: CELG ) competing against lead drug Velcade in treating multiple myeloma, Millennium experienced a rough couple of years.[34] Millennium's biggest drug is Velcade, a cancer drug used primarily to treat patients with multiple myeloma.[42] Velcade, Millennium's only approved product, treats relapsed multiple myeloma, a cancer of the plasma cell.[24] Velcade, the company's only approved product, treats relapsed multiple myeloma, a cancer of the plasma cell that is an incurable but treatable disease.[35]
Millennium markets Velcade, an injectable cancer treatment cleared for sale in more than 85 countries, and has a pipeline focused on oncology and inflammation. [16] I did some cursory math and the NPV of Velcade (assumeing a 20% IRR, 6 years of patent life remaining and a generous sales growth rate of 20%) is roughly $2B. Which, of course, leaves ~$6B on the table for an early clinical stage pipeline (no other phase 3s, just phase 1s and 2s). Though, I guess if you have $9B in cash laying around, it's better than sticking it in your ears.[14] Global pharmaceutical sales will expand $745 billion in 2008, with an expected annual market growth between 5 and 6 percent, according to IMS Health's 2008 Global Pharmaceutical Market and Therapy Forecast.[43] Millennium's peer Celgene Corp. (CELG) on March 7 said it completed the $2.9 billion acquisition of Pharmion Corp., which is expected to generate multiple global revenue streams.[22]
"Takeda is committed to becoming a global leader in oncology by delivering novel therapies that improve the standards of care for patients. Millennium has strong discovery, development and commercial capabilities led by a well-established management team," he added.[33] "Millennium greatly strengthens Takeda's global oncology portfolio," said Takeda President Yasuchika Hasegawa.[31]
Signing up with Abbott to form TAP (Takeda-Abbott Pharmaceuticals) some years ago was one step, as was recently buying out that entire partnership. They bought San Diego-based Syrrx a couple of years ago, and now they have a foot on the ground in Cambridge for oncology research. The Syrrx site is now " Takeda San Diego ", but interestingly, Millennium is apparently going to keep its name.[48] When the deal is completed, Cambridge, Mass. -based Millennium will become a wholly owned subsidiary of Takeda and operate as a standalone business unit.[33] Under the terms of the agreement, Millennium will remain in Cambridge as a standalone business unit of Takeda, and current CEO Deborah Dunsire will remain at the helm.[13] Under Takeda's ownership, Millennium will continue to be based in Cambridge, operating as a standalone business unit run by current CEO Deborah Dunsire.[42]
Steven H. Holtzman, who headed business development at Millennium from 1994 to 2001, and is now chief executive of Infinity Pharmaceuticals Inc. in Cambridge, said people misunderstood the impact of genomics.[41]
Millennium Pharmaceuticals, Inc. MLNM $24.39 +0.05 (+0.21%)[34] In early trading Millennium shares soared more than 49 percent to $24.43, up $8.08.[3] Millennium's shares rose $8.15 or nearly 50 percent on Thursday to $24.50.[10]
Millennium shares skyrocketed 48.9%, or $7.99, to close at $24.34 on Thursday.[31] Millennium's shares peaked at $86.50 in November 2000, and then went through a long decline.[41]
Takeda shares closed down 2.5%, or 140 yen ($1.39), at 5,140 yen ($51.05) in Tokyo on Thursday prior to the announcement of the deal.[31] The deal follows Eisai Co.' s December agreement to buy MGI Pharma Inc. for $3.9 billion as Japanese companies seek growth in the U.S. market.[24] The deal, the largest for an Asian drugmaker, follows an agreement by Tokyo-based Eisai Co. in December to buy U.S. biotech firm, MGI Pharma Inc., for $3.9 billion.[17]
Today's deal takes the company in the direction the global pharma herd is moving: Away from old-school primary care drugs for chronic conditions, and toward specialty biotech drugs that command higher prices. [14] The deal is subject to the tender of a majority of Millennium common stock and other customary closing conditions, including expiration of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and the antitrust laws of applicable foreign jurisdictions, the company said. The Board of Directors of both companies unanimously approved the transaction.[22] On the strength of that vision, as well as founding CEO Mark Levin's uncanny ability to cut lucrative partnership deals with pharma, the company's stock climbed to a peak of about $90 in 2000.[13]
The company, which reported total revenue of $528 million for 2007, said it has complementary research, development and commercialization capabilities with Takeda. [2] Takeda in February agreed to buy Amgen Inc.' s Japanese unit for as much as $902 million, gaining about a dozen experimental medicines including two in the final stages of human testing for lung cancer. Takeda hasn't developed any cancer therapies in its own labs that have progressed to advanced human trials.[32] On March 31, Takeda agreed to pay $50 million initially and up to $270 million later for the rights to an experimental "vaccine" to treat prostate cancer that is being developed by Cell Genesys.[44]
The local biotech's most well-known drug is Velcade, a blood cancer treatment. Some people throw out their beer bottles if the beer is flat. Sam Adams drinkers were checking this week to see if they should throw out new beer bottles after The Boston Beer Co. announced a recall of about 25 percent of its recently shipped bottles. The South Boston-based brewer said that bottles provided by a third-party supplier were found to be potentially defective, with a small portion of them having small bits of glass falling into the bottle. American Airlines offered some unfriendly skies to many of its passengers this week by canceling more than 3,000 flights as the carrier conducted safety inspections of its MD-80 jets. [27] Revenue rose 7.2 percent to 1.07 trillion yen as sales of the company's diabetes treatment drug Piglitazone, known in Japan as Actos, rose 23.3 percent.[12] Goldman Sachs analyst May-Kin Ho expects Velcade sales to continue rising, saying the market is underestimating the cancer drug's international growth potential.[5] Velcade can generate peak annual sales of $1 billion in the U.S., and $2 billion worldwide, Baird said.[17]
Millennium sells the treatment in the U.S. and shares revenue with J&J;, which markets Velcade in 85 other countries.[32] Millennium will operate as a wholly owned subsidiary in Cambridge, Mass., and continue to sell Velcade and future oncology products.[35] Millennium will 'enhance pipeline with clinically differentiated, high-quality product candidates,' said Yasuchika Hasegawa, President of Takeda.[12] "Our strong desire is to retain Millennium employees, who have created an entrepreneurial and innovative culture," Takeda's chief executive, Yasuchika Hasegawa, said in a statement yesterday.[23]
Our strong desire is to retain Millennium employees, who have created an entrepreneurial and innovative culture," Hasewaga further stated. In a statement, Takeda said it expects that the transaction will increase its earnings starting in the fiscal year ended in March 2010, even before the transaction related amortization.[1] I'''m told that retention bonuses are being offered, along with several other features to try to keep the Millennium operation running. Takeda'''s been increasing its U.S. presence over the years.[48]
"Takeda took advantage of the strength of the yen against the dollar to pay that premium in cash, to shut down any possible objection from Millennium stockholders about the lack of a competing bid,'' said Chris Raymond, an analyst with Robert W. Baird & Co. in Chicago, in an interview.[17] In the merger that follows completion of the tender offer, Mahogany Acquisition will be merged into Millennium, and the surviving entity will be an indirect wholly-owned subsidiary of Takeda.[21] The deal, the largest acquisition by Takeda, is structured as a tender offer and is conditional upon a majority of shareholders accepting the terms.[11]
The deal is the latest in a series of acquisitions in the biotech sector, as drugmakers scramble to secure promising pipelines and technologies developed by smaller companies, and it could spur a further wave of merger activity.[10]
Five of the acquisitions were of U.S.-based companies by bigger companies in Europe or Asia. These buyers spent $35 billion, or 73% of the total.[4] The top 10 acquisitions of life science firms over the past 12 months came at a total purchase price of $48 billion, according to a screen done using Mergerstat via Factset Systems.[4]
In 2001, Millennium promised much more. Its cofounder, venture capitalist Mark J. Levin, boasted that Millennium would be worth more than $100 billion within a decade.[25] Millennium rose 49 percent to $24.34 yesterday in Nasdaq Stock Market composite trading.[18] Cross Research upgraded the stock to buy from hold with a price target of $11.[30] CEPH hasn't been below $56 at all in the past year and has shown support around $59 recently. This trade could be risky if the company's earnings (due out on 5/1) disappoint, but even if that happens, that position could be protected by support the stock might find between $55 and $60, where it bottomed out in the past two months.[49] A bull-put credit spread is an options position that combines the purchase and sale of put options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make a 7.5% return in just five weeks as long as CEPH is above $55 at May expiration.[49] A raised first-quarter earnings outlook by retailing bellwether Wal-Mart Stores offset much of the weakness from retailers' disappointing March sales reports, while technology stocks were boosted by an upgrade for chip companies and increased deal talk for Yahoo.[50] Taking the plunge: Opportunity knocked and this entrepreneur rushed in. He didn't change his sales strategy. He changed his client strategy. Charles Myers bootstrapped his company after staggering losses on a business deal gutted the company'''s capital. Now Myers takes direct involvement in each project and lets someone else handle what had primarily been his role, business development.[26]
For Millennium, the Takeda takeover ends what has been a decidedly mixed run as an independent bio-pharmaceutical company. [42] After closing, Millennium will run as a standalone business unit for Takeda.[5] Takeda said Thursday it would begin the purchase process of Millennium within five business days, and finish within 20 days of that.[16]
"Competition is severe, especially in the cancer drug business, so Takeda has had to speed things up.''[17] Takeda has been under pressure for years to spend big and buy an overseas firm with a solid drug pipeline to offset an earnings decline before a key patent expires.[9] I worked some years ago for a textile company in the U.S. which was bought out by Takeda.[48] Takeda also signed a worldwide partnership with Cell Genesys CEGE for that company's experimental prostate cancer vaccine.[42]
Takeda shares fell 2.5 percent, closing on the Japanese market at 5,410 yen.[33] Takeda shares closed earlier down 2.5 percent at 5,410 yen. [email protected] - Copyright Thomson Financial News Limited 2008.[12]
Takeda will face low-priced competition to products, including Actos, that account for 40 percent of revenue.[17] Takeda gained the rights to the product Prevacid in heartburn and gastric reflux disease, plus all the remaining TAP commercial and support organizations, and the rights to TAP's pipeline.[33]
Takeda also plans to expand its global pipeline in GI, adding a novel anti-alpha4beta7 antibody and an oral CCR9 inhibitor for the treatment of IBD.[22] The deal is expected to accelerate Takeda's vision of becoming a global leader in oncology.[21] "Takeda is committed to becoming a global leader in oncology by delivering novel therapies that improve the standards of care for patients.[1]
The idea was that if disease-causing genes could be targeted, drug discovery might be accelerated. Millennium quickly attracted tens of millions of dollars in capital and formed relationships with major drug companies, such as Eli Lilly & Co., which hoped to use Millennium's genomics research to develop powerful drugs. It went public in 1996 and by early 2003 had more than 2,000 employees and a prominent campus near the Massachusetts Institute of Technology. [25] "You'll probably see more Japanese companies expanding in the U.S.," said Howard Liang, an analyst with Boston investment bank Leerink Swann & Co. Massachusetts is already home to a galaxy of European drug firms - including Novartis AG of Switzerland, EMD Serono of Germany, and British-based Shire PLC - which have flocked to the state mainly because of its successful companies and elite research universities.[25] Japanese drug makers have joined with several U.S. companies to develop and market several prominent drugs. Examples include Eisai and Pfizer Inc., with their Alzheimer's-disease drug Aricept, and Daiichi Sankyo Co. and Eli Lilly & Co., who are co-developing the anticlotting drug Prasugrel.[11]
"There's no doubt the weak dollar against the yen is making U.S. biotech very attractive right now to potential Japanese buyers," said Les Funtleyder, an analyst with Miller Tabak & Co. in New York.[24] "While today's news is obviously positive for Millennium holders, we anticipate considerable spill-over into other names in mid-cap biotech," said Christopher Raymond, an analyst at Robert W. Baird, in a research report.[10]
Founded in 1993 by a team of genomics pioneers including MIT's Eric Lander and Raju Kucherlapati, then of the Albert Einstein College of Medicine and now the scientific director of the Harvard Partners Center for Genetics and Genomics, Millennium was once one of the strongest proponents of genomics-based drug innovation at biotech firms.[13] Millennium is conducting human trials with experimental drugs for cancer, heart disease, gastrointestinal disorders and rheumatoid arthritis.[24] Human testing of the drug was disappointing and Millennium abandoned the research in 2003.[11] "Millennium is a leader in genome medicine, with some promising drugs in early development."[24]
Millennium's President and Chief Executive Officer Deborah Dunsire said, 'VELCADE sales continue to strengthen, driven primarily by greater use in patients with relapsed multiple myeloma.[22] We are pleased that Dr. Deborah Dunsire, Millennium President and Chief Executive Officer, and the current management team intend to continue to lead the Company.[1] No layoffs are expected at the 1,000-employee Millennium - and the current management team, including chief executive Deborah Dunsire, is expected to keep running the firm under the Millennium name, the companies said yesterday.[23]
Mark Leuchtenberger, chief executive of Targanta Therapeutics Corp. in Cambridge, noted that many midsize biotech stocks rose yesterday on the news. "I'm sure it wasn't just because it was a nice warm day," he said. "You've got a clear endorsement" of biotech companies' value, he said.[25] In 2000, the year the completion of the Human Genome Project was announced, biotech stocks soared on the expectation that genomics would revolutionize drug discovery.[44]
The stock was down $1.25 around 8:15 am ET, declining to $12.75. If pre-market losses hold, the stock will open at its lowest level since July 2003. Virgin Media on Wednesday revealed its intention to offer about $1 billion principal amount of Convertible Senior Notes due 2016 in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act.[29] The fall came after the company revealed plan to offer $1 billion in convertible senior notes due 2016.[29]
Microsoft, which has made a $31-a-share offer for Yahoo!, is not sitting idle. It is reportedly talking to News Corp. NWS to partner on its Yahoo! bid.[30]
Even adjusted for inflation, it ranks larger than Cambridge-based Biogen Inc.' s purchase of Idec Pharmaceuticals Corp. of San Diego five years ago for $5 billion. [25] Takeda had operating profit of 405.84 billion yen in the nine months to December, the last period for which figures are available. That compared with 382.82 billion yen a year earlier.[12] Takeda, which sank 33 per cent last year, dropped 110 yen, or 2 percent, to 5,300 yen today.[18] Japanese drugmakers are expanding outside the world's second-largest medicines market because domestic growth is hampered by the government's policy of reducing medicine prices every two years to curb the nation's 6.9 trillion yen drug bill.[32] Though the graying of Japan's population is driving up demand for pharmaceuticals, the country's shaky public finances has led the government to cut drug prices.[31] Derek Lowe, an Arkansan by birth, got his BA from Hendrix College and his PhD in organic chemistry from Duke before spending time in Germany on a Humboldt Fellowship on his post-doc. He's worked for several major pharmaceutical companies since 1989 on drug discovery projects against schizophrenia, Alzheimer's, diabetes, osteoporosis and other diseases.[48]
Takeda said it expects the deal to boost earnings starting in fiscal 2010. The deal has been approved by the boards of both companies and is expected to close in the second quarter.[12] Baird's Raymond speculates the deal could bring in an even larger bid, possibly from Millennium's Velcade partner Johnson & Johnson.[5] "Velcade will be a blockbuster in short order," Dunsire, who joined Millennium in 2005, said Thursday in a conference call with investors. Bloomberg News contributed to this report.[35] Millennium anticipates U.S. approval by June to promote Velcade as an initial therapy.[32] Millennium hopes to win approval from the FDA in June for broader use of Velcade in previously untreated multiple myeloma.[33] Velcade competes primarily with Celgene's CELG Revlimid for market share amongst multiple myeloma patients. The two drugs have recently stepped up their competitive battle for use amongst newly diagnosed, or front-line, multiple myeloma patients.[42] The drug is approved as a secondary treatment for the for multiple myeloma and the company is seeking approval for primary treatment.[39]
The Japanese company is also focused on areas of oncology discovery and commercialization. According to company officials, the acquisition has been unanimously approved by the boards of both companies.[2] The Millennium acquisition is the latest in a flurry of M&A; activity by Japanese drugmakers.[10] For Millennium, based in Cambridge, Massachusetts, the acquisition brings to a close a wild ride that did not turn out as initially planned.[44]
I also find it interesting that the company hasn'''t decided to put up a big research site in one location and call it '''Takeda ''' US''', but have rather taken the retail approach. How easy managing those sites will be depends on what approach they take. For now, it looks like they'''re going to take the easier one, which is to let Millennium carry on in their own style (albeit with more money). [48] Six analysts rate Millennium the stock "Buy," 10 give a "Neutral" rating, and analyst Sapna Srivastava of Morgan Stanley has the stock at "Sell."[28] The chart for CEPH is neutral and improving, while S&P gives the stock a bullish 4 Stars (out of 5) buy rating. For a bullish hedged play on this stock, I would consider a May bull-put credit spread below the $55 range.[49]
The notes would be convertible under certain circumstances into shares of Virgin Media common stock, cash or a combination of shares and cash, at the company's election.[29] MLNM closed Wednesday's regular trading session at $16.35, down $0.27 or 1.62%, on a volume of 4.5 million shares.[21] The bill would also change the way big companies are taxed, bringing in at least $200 million in just the first fiscal year.[27] In a regulatory filing, the investment bank said it liquidated three investment funds last quarter amid turmoil in the credit crisis. It moved the fund's assets, worth about $1 billion, onto its balance sheet and purchased another $800 million of "deteriorated" assets from other funds.[47] The drugmaker had 1.77 trillion yen ($17.5 billion) of cash as of Dec. 31, according to financial statements.[17]
"We speculate that the all-cash nature, the quick closing period, and high break-up fee ($247 million) are all intended to stave off any third-party suitors," said Robert W. Baird analyst Christopher J. Raymond, in a note to investors.[5] The price also tops the 12-month target price of any analyst covering Millennium.[5]
Takeda earlier noted that it expects sales and cost synergies from the restructuring in the U.S. operations. [22] I suspect/trust Takeda which provide the more long-term perspective in achievement of success as is the typical of common Japanese business approach. This would be a refreshing difference from most U.S. pharmas these days.[48]
Takeda specializes in treatments for diabetes and cardiovascular problems, and the buyout would give it a stronger position in the cancer treatment market.[39]
The company is running more than 15 oncology trials for drugs that may treat tumors of the blood, prostate and liver. [32]
SOURCES
1. Takeda Buys Millennium; Aims to Become Global Leader
2. Japan's Takeda to buy Millennium for $8.8B - Mass High Tech: The Journal of New England Technology:
3. Millennium sold for $8.8b to Japanese drug firm - Daily Business Update - The Boston Globe
4. The Science Business by Matthew Herper
5. The Associated Press: Millennium Pharma Soars on Takeda Bid
6. The Associated Press: Takeda Bids $8.8B for US' Millennium
7. Takeda to buy Millennium for $8.8 billion - Medical Marketing and Media
8. Therapeutics Daily
9. Analysts mixed on Takeda's $8.8 billion Millennium buy | Reuters
10. Takeda to buy Millennium Pharma for $8.8 billion | Reuters
11. Takeda to Pay Billions to Get Into Biotech - WSJ.com
12. Takeda to buy Millennium Pharma in $8.8 bln all-cash deal UPDATE
13. Takeda Takes Hold of Millennium for $8.8 Billion | Xconomy
14. Health Blog : Small Drug World: Takeda Dropping $9 Billion on Millennium
15. Takeda Offers $8.8 billion for Biotech Millennium - International Business Times -
16. UPDATE: Takeda Buys Millennium For $8.8 Billion In Chase For Growth
17. Bloomberg.com: Japan
18. Takeda Pharmaceutical to buy Millennium - The Money Times
19. Takeda to buy Millennium Pharmaceuticals for $8 billion -- chicagotribune.com
20. The Associated Press: Takeda Bids $8.8B for US' Millenium
21. RTTNews - Global Business News, Business Newswires, Business Articles, News Analysis.
22. Millennium To Be Bought By Takeda For $8.8 Bln Cash - Update [MLNM] - RTTNews, Today's Top Stories, Global Newswires, ToDay's Top News,Global Business news .
23. Takeda's 8.8B for Millennium includes bonuses for workers - BostonHerald.com
24. Japanese drug maker Takeda to acquire Millennium - Los Angeles Times
25. Mass. biotech is sold for $8.8b - The Boston Globe
26. Millennium to be acquired by Takeda Pharmaceutical - Boston Business Journal:
27. Business Week in Review - Waltham, MA - The Daily News Tribune
28. Out of the Gate: Millennium Rockets | Chron.com - Houston Chronicle
29. RTTNews - Global financial news, Hot Stocks, Stock Splits, Long Term Stocks.
30. Thursdays Winners & Losers: Millennium Pharmaceuticals | Winners & Losers | BMY IKN MLNM MSFT NSM SMCI TWX WYE YHOO - TheStreet.com
31. Takeda Takes Out Millennium - Forbes.com
32. Bloomberg.com: Worldwide
33. BioWorld Today
34. End of the Line for Millennium
35. Takeda to buy U.S. drug company -- chicagotribune.com
36. Bloomberg.com: Worldwide
37. Japanese drugmaker Takeda to buy Millennium Pharmaceuticals for US$8.8 billion - International Herald Tribune
38. Eyewitness News WPRI / FOX Providence - Providence, Rhode Island News, Weather, Traffic and Sports | Japanese company pays $8.8 billion for Cambridge, Mass.-based Millennium
39. Millennium Velcade Sales Rise 42 Percent
40. Takeda Reaffirms Oncology Goals With $8.8 Billion Millennium Acquisition
41. Whatever happened to the next big thing? - The Boston Globe
42. Japans Takeda Will Pay $9B for Millennium | Biotech | ABT AMGN CEGE JNJ MLNM - TheStreet.com
43. BeaconEquity.com - Millennium Pharmaceuticals Inc. (MLNM) Shares Climb 49 percent on $8.8 Billion Acquisition by Takeda
44. Takeda Pharmaceutical of Japan to buy Millennium Pharmaceuticals for $8.8 billion - International Herald Tribune
45. Ahead of the Bell: Millennium Pharma | Chron.com - Houston Chronicle
46. Takeda makes $8.8B bid for Millennium - FierceBiotech - Biotechnology Articles, Biotech Industry News, FDA Approval News
47. Nasdaq Hangs Tough While Others Slip
48. Free Sushi in the Cafeteria!. In the Pipeline:
49. Cephalon (CEPH) gets a boost from Millennium (MLNM) buyout - BloggingStocks
50. Free Preview - WSJ.com
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