Sanofi wins EU approval for Genzyme bid
No decision has been made regarding the takeover
French drugmaker Sanofi-aventis has won European Union regulatory approval for its hostile US$18.5bn takeover bid for US biotechnology firm Genzyme.
The European Commission said it had concluded that the deal ‘would not significantly impede effective competition in the European Economic Area or any substantial part of it.’
The EC also said that the proposed takeover does not raise concerns in the treatment of multiple sclerosis, where both companies are developing treatments. In all cases there will remain a sufficient number of other credible competitors, it added.
Sanofi-Aventis made a non-binding offer for the capital of Genzyme in August 2010 and commenced the tender in October. The takeover bid was notified to the European Commission on 29 November 2010 pursuant to EU merger rules even though the majority of Genzyme shareholders have yet to make a decision about the offer.
The European Commission said its competition assessment is without prejudice to whether the proposed transaction goes ahead.
Earlier this week the Genzyme and Sanofi-aventis said that discussions about the takeover are continuing and now include representatives of both companies.
Genzyme said these discussions have focused on potential terms for a negotiated transaction and have included the possible use of a contingent value right relating to alemtuzumab as part of any potential resolution of differences with respect to value.
Both companies said they could provide no assurance that these discussions will continue or result in a deal.
Genzyme’s financial recovery appears to be continuing after it reported that preliminary fourth-quarter revenue grew 23% to US$1.15bn. For the year, revenue was $4.1bn compared with $4bn in 2009.
This growth reflects increasing supplies of Cerezyme (imiglucerase) for Gaucher disease and Fabrazyme (agalsidase beta) for Fabry disease, which have been severely affected by the temporary closure of the firm's Allston Landing, Boston facility in June 2009, and the US launch of Lumizyme (alglucosidase alfa) for Pompe disease.
Cerezyme revenues were lower than anticipated, however, due to the delay of orders in Brazil, shipping delays in December due to bad weather in Europe and the loss of a specific lot for Japan.
‘We expect to maintain this earnings level in the first quarter and grow from there beginning in the second quarter, as we continue to execute on the opportunities provided by our core businesses and reduce our operating expenses,’ said Henri Termeer, chief executive of Genzyme.
The company said it expects to achieve several important manufacturing and product-related milestones during 2011, including: ceasing the remaining fill/finish activities at the Allston facility for all products during the first half of the year; announcing top-line data from the first phase 3 trial of alemtuzumab for multiple sclerosis mid-year and from the second trial in the second half of the year; and fully supplying existing patient demand for Fabrazyme and receiving approval for the treatment’s production at the new Framingham plant, both expected during the second half of 2011.
An expansion of fill/finish operations at the company’s Waterford, Ireland, site resulting in a four-fold capacity increase should be approved in late 2011.