- What share price does Genzyme CEO Henri Termeer believe his company is worth? He has so far refused to say.
- Is the Genzyme board of directors as united in opposition to Sanofi's $69-a-share offer as Termeer says it is?
- What does Sanofi CEO Chris Viehbacher know about Campath (alemtuzumab), Genzyme's star candidate for multiple sclerosis, the drug on which the future value of Genzyme hinges? Viehbacher used to work at Wellcome in the 1990s when the drug was one of that company's assets.
If Termeer doesn't know what number is acceptable, neither does anyone else. Here's the current range of guesses, all over the map:
- Sanofi: $69
- RBC Capital: $75-80 a share
- Piper Jaffray: $85 a share
- Genzyme: Sky is the limit
The "because" statement is almost certainly a compromise in a divided board. Two of the directors were appointed by Carl Icahn as a result of the settlement of a proxy fight. Another was appointed as a result of an earlier tussle with Relational Investors. My bet is those three directors are not up for a fight to the death to keep Genzyme independent. Instead, they want the highest price. It will be interesting to see if Genzyme directors immediately start to shop the company -- and if not, whether that decision is unanimous.Lastly, I previously noted that acquiring Genzyme's Campath would give Sanofi a much stronger expertise in M.S., for which the company has its own candidate, teriflunomide. But did you know that Viehbacher is more familiar with Campath than he may be letting on? Viehbacher worked at Wellcome in the 1990s, according to Reuters, and at that time Campath was a Wellcome development drug:
Originally the fruit of research at Cambridge University, England -- the name is derived from Cambridge Pathology -- it was on the books at drugmaker Wellcome in the 1990s when Viehbacher worked at the company.At the time, the concern over Campath was its dreadful side effect profile, including blood disorders and infections. Now Campath is on the market for blood cancer, so Viehbacher knows it can pass muster at the FDA. He also knows that doses for MS would be much lower than those needed for chronic lymphocytic leukemia, which may make its side effect profile easier.
The good news for investors is that not doing the deal makes no sense for either company. Genzyme's stock just isn't worth $69 or more without an acquirer, and Sanofi needs new products to replace those going off patent. A fifth of Sanofi's revenues are threatened by patent expiries through 2013, Genzyme noted in its SEC filing.
- Sanofi's Hostile Bid Triggered by Genzyme CEO's Selective Deafness
- Snail's Pace: Why the Sanofi-Genzyme Deal Is a Copy of Roche-Genentech