Onyx Pharmaceuticals said yesterday it has begun shopping for its own would-be buyer willing to spend significantly more for the company than the unsolicited $120-per-share Amgen offer rejected by Onyx’ board.
“We are actively exploring the potential to combine Onyx with another company as an option to create additional value for Onyx shareholders,” N. Anthony Coles, M.D., Onyx’ chairman and CEO, said in a statement. “With the expansion of our pipeline and two successful product launches, the company and our talented employees have created significant value for Onyx shareholders.”
Onyx said it believes it can capture more of that value through its own sale rather than by selling to Amgen, which offered about $10 billion or $120 per share cash—a 38% premium above Onyx’ closing share price Friday of $86.82. Onyx said in the statement that its board “concluded that the price proposed by Amgen significantly undervalued Onyx and its prospects, and was not in the best interest of Onyx or its shareholders,” then told Amgen as much on Friday.
Canada’s Financial Post first reported the Amgen offer after the close of trading Friday. Onyx yesterday confirmed the offer, then adding that it won’t discuss further the Amgen proposal or how its board will consider other proposals. Onyx has solicited interest from at least two pharmaceutical companies involved in oncology since the offer first became public, Bloomberg reported, citing an unnamed source.
Onyx finished last year with a $187.8 million net loss, down from net income $76.1 million in 2011, on total revenue of $362.2 million. Some 80% of that revenue came from two drugs co-marketed with Bayer HealthCare Pharmaceuticals: Nexavar (sorafenib) tablets for hepatocellular carcinoma (HCC), which is the most common form of liver cancer, advanced renal cell carcinoma (RCC) or kidney cancer; and the blood cancer treatment Stivarga (regorafenib) for injection.
Sorafenib has been evaluated in a Phase III trial to determine its potential in thyroid cancer, and is now in late-stage studies in breast cancer and as an add-on treatment for liver and kidney cancer following surgery.
In 2011, reporting only total operating revenue, Onyx recorded $447.2 million. The revenue drop since then reflects in part a step-up in R&D spending and the launch of its first wholly owned product, Kyprolis (carfilzomib) for multiple myeloma patients who have received at least two prior therapies including bortezomib and an immunomodulatory agent, and have demonstrated disease progression on or within 60 days of completion of the last therapy.