ALSO READDenmark's Novo Nordisk offers $3.1 billion for Belgian biotech group Ablynx Novo Nordisk bids $3.1 billion for Belgian biotech group Ablynx Wall Street Weekahead: This year's lumps of coal could be 2018's diamonds Corrected: Wall Street set to open lower as Apple, chipmakers weigh Special Report: Scientists describe problems in Philip Morris e-cigarette experiments
By Jacob Gronholt-Pedersen and Robert-Jan Bartunek
COPENHAGEN/BRUSSELS (Reuters) - Denmark's Novo Nordisk, the world's biggest maker of insulin, went public with a 2.6 billion euro ($3.1 billion) bid for Belgian biotech group Ablynx on Monday as it seeks to bolster its treatments for rare blood disorders.
Ablynx said it rejected Novo's latest takeover approach and analysts predict the Danish group, whose new chief executive is seeking growth by buying drugs developed by competitors, might face counterbidders and would need to raise its bid.
The approach comes at a time of renewed interest by large drugmakers in smaller biotech firms, with U.S.-based Celgene clinching a deal to buy Impact Biomedicines for up to $7 billion on Sunday and Japan's Takeda Pharmaceutical agreeing last week to buy another Belgian biotech group TiGenix for $630 million.
Novo has offered up to 30.50 euros per share for Ablynx, which represents a 60 per cent premium to the Belgian company's Dec. 6 share price, before its first approach. Ablynx shares were suspended until further notice by Belgium's market regulator on Monday and last traded at 21.20 euros on Friday.
The Belgian group specialises in the research of novel drugs based on nano-bodies found in the immune systems of llamas and alpacas, for which it partners with several of the world's largest pharmaceutical companies.
The main attraction for Novo is Ablynx's experimental drug caplacizumab for the rare bleeding disorder acquired thrombotic thrombocytopenic purpura, which would complement Novo's line-up of blood products focused on haemophilia.
"We have solid growth in our diabetes and obesity business but we are struggling a little bit to maintain the same level of growth momentum in biopharma," Novo's Chief Financial Officer Jesper Brandgaard said.
The Danish company said it would pay 28.00 euros per share in cash for Ablynx and an additional 2.50 euros in a so-called contingent value right (CVR) if certain conditions related to other drugs in Ablynx's research portfolio were met.
Under previous chief executive Lars Rebien Sorensen, Novo sat out a spate of deal-making across the drugs industry and instead focused on its market-leading position making insulin and other diabetes treatments.
Finance chief Brandgaard said the current bid could be revised if Ablynx agreed to engage in talks.
"I think it would be natural to update the bid following a detailed discussion with the board of directors of Ablynx," he said on a conference call, adding that it would be premature to speculate on any increase.
Brandgaard also played down the threat of an interloper, saying: "In terms of counter proposals it is not our understanding that any other bidder is pursuing the target."
ABLYNX SHARES SUSPENDED
"We envisage Novo needing to hike the offer and could see counterbids," the analysts said.
Ablynx's shares have almost doubled in price in the past 12 months, buoyed by successful clinical trial data.
($1 = 0.8322 euros)
(Additional reporting by Stine Jacobsen in Copenhagen, Ben Hirschler in London and Abinaya Vijayaraghavan in Bengaluru; Editing by Edmund Blair/Keith Weir/Alexander Smith)
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)