"Astellas announced Monday that it has made an unsolicited offer to acquire all outstanding shares of OSI Pharmaceuticals in a deal worth $3.5 billion. The Japanese company's CEO Masafumi Nogimori said that the "offer follows attempts over the past 13 months to engage OSI in meaningful discussions," adding that "as recently as February 12" OSI rejected an offer from Astellas, saying it "very significantly undervalues" the company."
Whoa! Interesting news to start the month of March in Pharmaland.
On Astellas' website, the press release further stated that:
"The all-cash offer, set forth in Astellas’ letter to OSI delivered this morning, represents a significant premium of over 40% on the closing price of OSI’s common stock of $37.02 per share on February 26, 2010, a 53% premium to its three-month average of $34.01 per share, and a 31% premium to its 52-week high of $39.66 per share. Astellas’ offer is not subject to any financing conditions."
Source: Astellas US
My guess is that the bid will be turned down again and a higher bid will need to be made.
Astellas is clearly keen to expand beyond their urology and immunology focus and build its oncology franchise. It has already completed a deal with Medivation to develop MDV3100 in prostate cancer, so OSI's Tarceva (erlotinib) franchise and an interesting small molecule pipeline, including an IGF-1R inhibitor would be attractive to Astellas. Roche license erlotinib from OSI, which will make the bid all the more fascinating – how will Roche/Genentech and OSI react to the hostile bid?
Beyond an improved offer, who knows what will happen. There are no guarantees, as the previous offer for CV Therapeutics fell through. It could get very interesting in the next few weeks and no doubt a lot of Pharma business development and licensing people are watching the situation closely to see what happens!