Luke Timmerman did a piece in Xconomy this morning about the best acquisitions by pharma during the last few years during the market recession. As he noted, biotechs did not have a good VC source of funds nor any real prospects of tapping the IPO market so were forced to play with the Big Pharma sharks. This resulted in some bargains for the big guys. Here are the top deals named by Timmerman during that period (2008-2012):
- Onyx purchase of Proteolix for its drug carfilzomib (Kyprolis). Onxy parlayed their $276 M upfront investment into being purchased for $10 B by Amgen this year. I think most people would heartily agree with this one.
- Gilead Sciences purchase of Calistoga Pharmaceuticals for its PI3 drugs for blood cancer at price of $375 M upfront plus milestones. This is now a hot therapeutic target and predictions are for $1 B plus in peak sales on the horizon. This one still has a ways to go to fully payoff.
- BMS acquisition of Medarex for its "trail-blazing cancer immunotherapy franchise." If it pans out, the $2.4 B price tage might look cheap. But there are plenty of critics for this deal too and the final jury vote may hinge on the success or failure of the PD-1 based drugs in its pipeline. If these hit for a forecast $10 B in sales annually (or more), then the $2.4 B price will look like a bargain. It's still an IF.
- Calgene acquisition of Avila Therapeutics BTK inhibitor for $350 M upfront plus milestones. This one hasn't proven itself in te clinic yet -- and its value is therefore largely inferred by its competitors having their lofty valuations based mostly on the possession of a BTK inhibitor too. This may well payoff but could also be group of companies with a treatment that doesn't pan out.
- Roche investment of $46.8 B in Genentech for access to its cancer franchise. This one seems light years different than the deals above in magnitude. But so far the patnership has brought Kadcyla and Perjeta to market. Plus looming in the near foreground is "son of Rituxan", GA101. The company is also beginning to look at areas within neuroscience for its next stream of treatments. This one will have to be judged on a longer more historic timeline but looks good so far. See Xconomy.
Posted by Bruce Lehr Oct 28th 2013.