Icahn Offered $23 Billion for Biogen Idec—Elan Won’t Block Sale
Carl Icahn has offered $23 billion for Biogen Idec and believes that would be a good value; meanwhile Biogen partner Elan said it would not stand in the way of the sale, Bloomberg reported this morning. In the wake of Friday’s announcement that Biogen would consider selling under the right terms, Icahn is giving out more of his side of the story. Icahn told Bloomberg that Elan, Biogen’s partner on a key multiple sclerosis drug, Tysabri, would not attempt to act as a “poison pill” and stop the purchase.
“If an offer was made, Elan would not activate its change of control provision,” for Tysabri, Icahn said in the interview with Bloomberg. “That’s very important,” he added. “It opens the door a lot.”
Biogen Idec (NASDAQ: BIIB) announced after the market closed on Friday that it was evaluating the possibility of a sale and had received “expressions of interest” from several parties, including Icahn. A key to the company’s valuation is Tysabri, which some analysts believe could surpass $2 billion in sales in the three years, according to Bloomberg.
Dublin, Ireland-based Elan told Bloomberg that it hired Lehman Brothers to help consider its options with regards to Tysabri, including restructuring the contract, selling its stake in the drug, buying out Biogen’s share, or leaving things as they are. The Irish drugmaker could also decide to work with any buyer, Bloomberg reported a Biogen spokeswoman as saying.
In after hours trading on Friday Biogen’s shares soared more than 12 points, or almost 18 percent, to $81.60. As of pre-market trading this morning the price had risen further, to $82.90. That was apparently its highest level since a three-for-one stock split in January of 2001.
Biogen CEO Jim Mullen has spoken in detail about innovation at his company and its prospects for future growth. See our interview with Mullen about innovation, and our story about his remarks on Biogen’s future prospects, in which he recently set a target of 15 percent compounded annual growth through 2010.