Roche Seeks To Find Many Cures: Acquires InterMune For $8.3 Billion
Roche Seeks To Find Many Cures: Acquires InterMune For $8.3 Billion
Roche Holding AG has taken the decision to purchase the US biotech firm InterMune Inc thereby enhancing the firm's hold in the field of respiratory medicine. The $74 pr share cash offer is around 38 pct premium. Roche has pegged the transaction neutral for core EPS in the year 2015. Apart from this, the consensus sales in 2019 for InterMune drugs for lung disorders has been pegged at $1.04 billion.
This will help the Roche which is currently the top cancer drugs maker in the market to expand into other areas such as treatment of rare diseases. The incurable or rare diseases are an area where not much research has been done so far and neither have satisfactory drugs been developed. The current Ebola virus pandemic in Africa points to the urgent need for developing life saving drugs for diseases that are as yet incurable.
Neurological and mental disorders such as schizophrenia are still not completely curable and treatment focuses on patients recovering through remissions followed by lengthy periods of medication. Roche has recently faced defeats in the area of developing experimental drugs for this disorder as well as diseases such as diabetes and heart problems. But in the area of respiratory diseases at least, the pharma company is set to bring about much needed innovation through its latest acquisition.
Swiss pharma company Roche is already selling Pulmozyme for cystic fibrosis as well as Xolair for severe asthma. It is also testing a drug for treating severe asthma which is known as lebrikizumab. InterMune can now collaborate with Roche to market a promising drug called pirfenidone for idiopathic pulmonary fibrosis or scarring of lungs.
Roche has also said that it will pay $74.00 per share via a tender offer for the company which represents a premium of 38% to the closing rate on 22nd Aug and 63% premium over Aug 12th when the the acquisition speculation around the stock commenced. The acquisition has been given an approval by both the company boards and it is the biggest by the Swiss pharma company since the year 2009. Roche purchased the remaining stake in Genentech for $47 billion that year.
The general opinion among the analysts is that the price tag of InterMune is high but talk is on in many circles that this was a tactical move with positive repercussions for the group. Industry analysts also hold that prifenidone will have impressive sales by 2019.
Roche itself experienced a surge in share value by about 0.5% at 267.2 Swiss francs following announcement of the acquisition. The massive premium handed out to InterMune is not considered uncommon in biotech takeovers and this reflects a rapid competition for new drugs in a wider circle of large firms. Roche expects the acquisition to boost profits by 2016 and give good results. With research in the area of experimental drugs ongoing and acquisitions such as these, hope remains ignited among those suffering from these incurable disorders.
