Pfizer Inc (NYSE:PFE) may want Onyx to adorn its crown
Pfizer Inc (NYSE:PFE) has shown interest in buying-out Onyx a biotech company whose cancer drugs have a very promising revenue stream. Apart from Pfizer, Novartis has also shown an interest in the company. Onyx has a market value of approximately $9.5B and put itself up for a buy-out on Sunday. It cited certain “expressions of interest” from some unnamed companies. The company also stated that it had very recently rejected an $8.7B offer from Amgen Inc as it seemed too low.
Pfizer is due to pay the company royalties on a very promising experimental breast-cancer drug and is interested in Onyx as well as its portfolio of various marketed cancer treatments said some unnamed sources.
Amgen’s June offer of $120/share was the first and Onyx had not indicated whether it was the best and the final. Amgen is also expected to be a participant in this auction process. On Monday, Onyx skyrocketed 51.3% and closed at $131.33 which was well above the offer that had been put forth by Amgen’s. This indicated that investors have taken note that biggies such as Pfizer Inc (NYSE:PFE) are taking interest and were expecting the bids to touch more than that.
The attraction quotient
The general market-watcher opinion is that Onyx may appeal to a broad group of big biotech and pharma companies such as AstraZeneca Plc, Bayer AG and Merck & Co. Larger players in the industry have been seeking to acquire smaller biotechnology firms in order to gain access to various new drugs. These are generally high-priced cancer treatments. Many companies have been facing distinct revenue losses that have arisen from expired patents of many of their drugs.
The oncology landscape
A boom in innovative science, sustained Research & Development investment as well as clinical successes of a completely new wave of targeted-therapies have literally transformed the current day oncology landscape. Cancer control treatments now seem more within reach and a possibility that lies just around the bend in the road. However, there is no change in the fact that launching a product in the market and making it successful and profitable are a major challenge. There was a time when clinical proof was considered more than enough for a product to succeed in oncology. But all that has changed and studies have to be complemented with a compelling demonstration of “value” in treatment.