Orlando, FL. 1/25/12 (StreetBeat) -- Amgen (Nasdaq: AMGN) has agreed to buy Micromet (Nasdaq: MITI), a biotechnology company that develops cancer drugs, for $1.16 billion.The offer of $11 a share represents a premium of 33 percent from Micromet’s closing stock price on Wednesday.
Micromet, which currently has no drugs on the market, designs cancer therapies that target blood and solid tumor cancers, including leukemia and non-Hodgkin’s lymphomas. The company has research facilities in Munich and is based in Rockville, Md.
Among Micromet’s drugs in development is blinatumomab, which treats acute lymphoblastic leukemia, that is now in Phase 2 trials.
“The acquisition of Micromet is an opportunity to acquire an innovative oncology asset with global rights and a validated technology platform with broad potential clinical applications,” Kevin Sharer, Amgen’s chief executive, said in a statement on Thursday. “Blinatumomab will serve as an important complement to our oncology pipeline.”
Amgen, which is set to reporting earnings after Thursday’s close, plans to acquire Micromet’s shares in two phases. A subsidiary of Amgen will buy at least a majority of Microment’s outstanding shares at $11 a piece. The parent company will then buy any remaining shares, at the same price. The deal will likely close in the first quarter, the company said in a statement.
Amgen is one of the world’s largest drug makers, with more than $15 billion in annual sales, however, the company has struggled to fill its pipeline with new blockbuster drugs. In the last five years, it has only introduced one runaway hit, denosumab, an osteoporosis treatment. Last year, the company slashed 6 percent of its research and development staff and issued a $5 billion share buy back in December. That month, the company’s current chief executive, Mr. Sharer, also announced his retirement. Robert Bradway, the chief operating officer and president, will replace him in May.
This would be the biggest acquisition by Amgen since it had agreed to acquire Abgenix for $2.2 billion in cash in 2005, according to Capital IQ data.
The pharmaceutical industry has been a bright spot for deal-making so far this year. Earlier this week, drug maker Roche Holding, announced a hostile $5.7 billion bid for Illumia, a genetic analysis service, in a bid to strengthen its diagnostic business. Separately, on Thursday, Celgene said agreed to buy Avila Therapeutics, a private biotechnology company, for $350 million in upfront cash and up to $195 million if certain targets are met.
Amgen was advised by Moelis & Company and the law firm of Sullivan & Cromwell. Goldman Sachs and the law firm of Cooley advised Micromet.
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