we live in hope26 Nov 2018 11:31
Among featured M&A news last week, US devices company Boston Scientific made a $4.24 billion bid for UK-based specialty pharma firm BTG, and there was also talk that US immuno-oncology company Tesaro may be putting itself up for sale. On the research front, there was disappointment for Germany’s Merck KGaA and US partner Pfizer as their immune checkpoint inhibitor Bavencio (avelumab) failed to meet endpoints in a Phase III ovarian cancer study. But there was better news for Danish diabetes care giant Novo Nordisk, with positive cardiovascular outcomes with its oral semaglutide in the PIONEER 9 trial.
Boston bid for BTG shows dreams can come true
Analysts who had been predicting a gloomy future for BTG will have been eating their words last Tuesday. The medtech big hitter Boston Scientific has agreed to pay 840 pence per share for the UK group, a valuation not seen since 2001, commented Madeleine Armstrong on Vantage, the editorial arm of the Evaluate group. This surprise outcome is a huge coup for investors in the UK group, which has struggled to find focus after a string of acquisitions.
Boston is not interested in BTG’s older, speciality pharma products, such as the snake venom antidote CroFab. The Marlborough, Massachusetts-based company wants to get its hands on devices for cancer and pulmonary embolism.
BTG gained these via more recent purchases, and has thus managed to reduce reliance on Zytiga, on which the company receives substantial royalties from Johnson & Johnson. The prostate cancer drug is set to come off patent soon in the US, meaning that BTG's main revenue stream is drying up.
In the coming years, most valuable product is expected to be its Therasphere radiotherapy microspheres, used to treat liver cancer. This product makes up the bulk of the group’s interventional oncology sales, which are forecast to hit around $330m by 2022.
The takeout means that the UK will lose one of its few small-mid cap life science companies, but in reality BTG has been struggling to make headway for years. Investors will be forgiven for thinking Christmas has come early. Shareholders in other hotly-tipped takeout targets can live on in hope.