A definitive merger agreement has been unanimously approved by the Boards of Directors under which Merck & Co and Schering-Plough will combine, under the name Merck, in a stock and cash transaction. Under the terms of the agreement, Schering-Plough shareholders will receive 0.5767 shares and US$10.50 in cash for each share of Schering-Plough. Each Merck share will automatically become a share of the combined company.
Based on the closing price of Merck stock on 6th March, the consideration to be received by Schering-Plough shareholders is valued at US$23.61 per share, or US$41.1 billion in the aggregate. This price represents a premium to Schering-Plough shareholders of approximately 34 per cent based on the closing price of Schering-Plough stock on 6th March. The consideration also represents a premium of approximately 44 per cent based on the average closing price of the two stocks over the last 30 trading days.
Upon closing of the transaction, Merck shareholders are expected to own approximately 68 per cent of the combined company and Schering-Plough shareholders are expected to own approximately 32 per cent. Merck anticipates that the transaction will be modestly accretive to non-GAAP EPS in the first full year following completion and significantly accretive thereafter.
The combination significantly broadens Merck's portfolio of medicines driven, in part, by the addition of valuable products with long periods of exclusivity. By leveraging the combined company's expanded product offerings, Merck expects to benefit from additional revenue growth opportunities. For example, the combined company will have expanded opportunities for life-cycle management through the introduction of potential new combinations and formulations of existing products. In addition, Merck and Schering-Plough together have high-potential early-, mid- and late-stage pipeline candidates. The transaction will double the number of potential medicines Merck has in Phase III development, bringing the total to 18. The combined company will have a more diverse portfolio across important therapeutic areas, including oncology.
Schering-Plough's current oncology products, which include Caelyx (pegylated liposomal doxorubicin), Intron A (interferon alpha-2b recombinant for injection)/PegIntron (peginterferon alpha-2b) and Temodar/Temodal (temozolomide) Capsules, will enable Merck to expand its presence in this area and provide the necessary foundation to take advantage of the combined company's promising pipeline. Merck also expects to benefit from a solid portfolio of women's health products, which includes the cervical cancer vaccine, Gardasil (human papillomavirus quadrivalent types 6, 11, 16 and 18 vaccine, recombinant).
The transaction is subject to approval by Merck and Schering-Plough shareholders, and the satisfaction of customary closing conditions and regulatory approvals, including expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Act, as well as clearance by the EC under the EC Merger Regulation and certain other foreign jurisdictions. Merck and Schering-Plough expect to complete the transaction in the fourth quarter of 2009, by which time there may well have been more such acquisitions, with Bristol-Myers Squibb being the current favourite target.
Matthew Dennis - Editor, Cancer Drug News
Showing posts with label Schering-Plough. Show all posts
Showing posts with label Schering-Plough. Show all posts
Friday, March 13, 2009
Wednesday, January 7, 2009
Losers of 2008
As the year begins, it provides an opportunity to reflect on the past 12 months and to highlight those companies and drugs that have not fared so well. Starting off the year badly, as a knock-on effect from 2007, was Novacea, which in April received notification from Schering-Plough of its termination of the collaboration agreement relating to the development of Asentar (DN-101). In 2007, the companies halted the Phase III ASCENT-2 trial of Asentar for the treatment of patients with androgen-independent prostate cancer (PCA), due to an imbalance of deaths between the two treatment arms. The companies then suspended enrolment in other ongoing trials involving the drug. There was a glimmer of hope for Novacea later in the year as it entered into a merger agreement with Transcept Pharmaceuticals, however Asentar was offered no such lifeline and there are no plans to resurrect it.
As with previous years, cancer vaccines promised much in 2008, but again failed to deliver. Favrille's Phase III registration trial for Specifid (mitumprotimut-T) administered following Rituxan (rituximab) in patients with follicular B-cell non-Hodgkin's lymphoma failed to show a statistically significant improvement in the primary endpoint of time-to-progression. Due to the results, Favrille is discontinuing development of the vaccine and is currently evaluating steps to conserve cash and recognise value on its assets, which include a reverse merger with MyMedicalRecords.com. Cell Genesys also suffered as the company, along with Takeda and its wholly-owned subsidiary, Millennium Pharmaceuticals, suspended further development of GVAX immunotherapy for PCA. In October, Cell Genesys terminated the Phase III VITAL-1 trial of GVAX in patients with asymptomatic, metastatic hormone-refractory PCA following an analysis, which indicated that the trial had a <30 class="blsp-spelling-error" id="SPELLING_ERROR_24">Genesys to implement a substantial restructuring plan, which will include the loss of around 80 per cent of its employees.
Other drugs to fail in Phase III included Taiho Pharmaceutical's S-1 in advanced gastric cancer, which caused sanofi-aventis to return its development and commercialisation rights to the oral anticancer agent, as well as Progen Pharmaceuticals' PI-88 in hepatocellular carcinoma, for which the company cited reduced commercial opportunities. A further surprise came when the FDA notified Introgen Therapeutics that its BLA for Advexin (contusugene ladenovec), the company's targeted p53 tumour suppressor gene therapy for the treatment of recurrent, refractory squamous cell carcinoma of the head and neck (SCCHN), was not sufficiently complete and would not be filed at this time. Introgen intends to appeal this refuse to file decision and is reviewing the various options available to it. The decision came as a surprise, as earlier in August, the EMEA accepted for review Gendux Molecular's (Introgen) MAA for Advexin for the treatment of recurrent, refractory SCCHN.
But perhaps the biggest loser of the year was Bristol-Myers Squibb, which lost out to Eli Lilly in the race to takeover ImClone Systems. However, BMS did receive approximately US$1 billion in cash following the acquisition, an amount that in the current financial climate is perhaps as valuable.
Matthew Dennis - Editor, Cancer Drug News
As with previous years, cancer vaccines promised much in 2008, but again failed to deliver. Favrille's Phase III registration trial for Specifid (mitumprotimut-T) administered following Rituxan (rituximab) in patients with follicular B-cell non-Hodgkin's lymphoma failed to show a statistically significant improvement in the primary endpoint of time-to-progression. Due to the results, Favrille is discontinuing development of the vaccine and is currently evaluating steps to conserve cash and recognise value on its assets, which include a reverse merger with MyMedicalRecords.com. Cell Genesys also suffered as the company, along with Takeda and its wholly-owned subsidiary, Millennium Pharmaceuticals, suspended further development of GVAX immunotherapy for PCA. In October, Cell Genesys terminated the Phase III VITAL-1 trial of GVAX in patients with asymptomatic, metastatic hormone-refractory PCA following an analysis, which indicated that the trial had a <30 class="blsp-spelling-error" id="SPELLING_ERROR_24">Genesys to implement a substantial restructuring plan, which will include the loss of around 80 per cent of its employees.
Other drugs to fail in Phase III included Taiho Pharmaceutical's S-1 in advanced gastric cancer, which caused sanofi-aventis to return its development and commercialisation rights to the oral anticancer agent, as well as Progen Pharmaceuticals' PI-88 in hepatocellular carcinoma, for which the company cited reduced commercial opportunities. A further surprise came when the FDA notified Introgen Therapeutics that its BLA for Advexin (contusugene ladenovec), the company's targeted p53 tumour suppressor gene therapy for the treatment of recurrent, refractory squamous cell carcinoma of the head and neck (SCCHN), was not sufficiently complete and would not be filed at this time. Introgen intends to appeal this refuse to file decision and is reviewing the various options available to it. The decision came as a surprise, as earlier in August, the EMEA accepted for review Gendux Molecular's (Introgen) MAA for Advexin for the treatment of recurrent, refractory SCCHN.
But perhaps the biggest loser of the year was Bristol-Myers Squibb, which lost out to Eli Lilly in the race to takeover ImClone Systems. However, BMS did receive approximately US$1 billion in cash following the acquisition, an amount that in the current financial climate is perhaps as valuable.
Matthew Dennis - Editor, Cancer Drug News
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