DOW JONES NEWSWIRES
Cephalon Inc. (CEPH) offered to pay about $163 million to take
over the rest of Australian biopharmaceutical company ChemGenex
Pharmaceuticals Ltd. (CXS.AU, CXSPY).
ChemGenex's board recommended the bid, provided no superior
offers emerge.
The bid comes one week after Cephalon, also a biopharmaceutical
maker, agreed to buy a privately held cancer-treatment developer
for $225 million in cash, with the possibility for paying an
additional $300 million for regulatory and sales milestones.
Thursday, Cephalon said converted ChemGenex notes it held to
shares representing a 28% stake in the company. It is offering
A$0.70 cash for each ChemGenex share it doesn't now hold and A$0.02
for each ChemGenex option. The offer values all the stocks and
options Cephalon doesn't own at about approximately A$159 million
(US$163 million); it values all the company's shares and options at
about A$225 million total.
Cephalon said the per-share offer price represents a 59% premium
to ChemGenex stock's most recently traded price.
"The proposed transaction allows ChemGenex shareholders to
realize cash proceeds at a significant premium to recent trading
levels and adds an interesting late-stage opportunity to our
portfolio," Cephalon Chief Executive Kevin Buchi said.
ChemGenex focuses on treatments for blood-related disorders and
diseases. Its lead product candidate, Omapro, is intended to treat
a cancer of white blood cells called chronic myeloid leukemia. The
company recently finished late-stage trials of the drug and plans
to file a new drug application with the U.S. Food and Drug
Administration in the second half.
Cephalon has eight products on the U.S. market, selling
specialty drugs for alertness, central-nervous-system disorders,
pain management and cancer.
Recently, Cephalon has been benefiting from stronger sales of
its products, which include treatments for alertness,
central-nervous-system disorders, pain management and cancer. In
the fourth quarter, the bottom line declined 3% but adjusted profit
unexpectedly grew.
Shares in the Cephalon closed Thursday down 0.6% at $57.57 and
weren't active after hours. The stock has fallen 18% in the last
year.
-By Joan E. Solsman, Dow Jones Newswires; 212-416-2291;
joan.solsman@dowjones.com
