Novartis launches bid for British biotech
Swiss drugmaker Novartis has announced a takeover bid for British "superbug" specialist NeuTec Pharma to fortify its infectious disease portfolio.
Novartis said it was offering £10.50 (SFr23.8) per share and sought to acquire a 100 per cent stake in the biopharmaceutical firm, valuing the deal at £305 million.
NeuTec’s board of directors had already recommended the deal and shareholders with 39 per cent stake in the firm supported the deal, according to Novartis.
“We believe this is a good and full offer after having completed due diligence,” said Novartis spokesman John Gilardi.
NeuTech shares surged more than 80 per cent on Tuesday after the company admitted it was in takeover discussions. The firm specialises in developing medicines against hard-to-treat hospital-acquired infections, or so-called “superbugs.”
The bid is part of a two-year-old drive by Novartis to strengthen its portfolio of treatments for infectious diseases, focussing on hepatitis and life-threatening infections.
NeuTec is a relative rarity among biotechnology companies in having a number of late-stage experimental drugs that have not yet been partnered with a large drugmaker.
NeuTec’s most advanced product, Mycograb, is currently awaiting European approval for the treatment of invasive candidiasis — a life-threatening form of thrush. It is also investigating using the medicine as a breast cancer treatment.
A second medicine, Aurograb, is in final Phase III tests for treating methicillin-resistant staphylococcus aureus (MRSA), the hospital-acquired superbug.
Pipeline
“We are building a pipeline of first-in-class compounds to effectively and safely treat hospital infections as well as hepatitis to fulfill an urgent unmet medical need,” said Novartis Pharma CEO Thomas Ebeling in a statement.
“The acquisition of NeuTec will expand our infectious disease portfolio to dramatically strengthen our position in hospital infections.”
On Tuesday, Novartis unveiled a separate, $507 million (SFr617 million) deal to boost its antiviral-drug pipeline by buying rights to the hepatitis C drug Albuferon from American biotech company Human Genome Sciences.
The deals, which follow one in March worth $525 million with another United States firm, Idenix Pharmaceuticals, for another experimental hepatitis C treatment, underscore Novartis’s reputation as an aggressive acquirer of medicines developed by other companies.
Analysts say major drugmakers are increasingly turning to licensed products to fill out their in-house portfolios.
swissinfo with agencies
Invasive candidiasis is a fungal infection that may occur when a person’s own Candida organisms, normally found in the digestive tract, enter the bloodstream.
On rare occasions, this can also happen when medical equipment or devices become contaminated with Candida.
If the infection does not respond to treatment, the patient’s organs may fail and cause death.
Some Staphylococcus aureus bacteria including MRSA are resistant to antibiotics.
These infections occur most frequently among persons in hospitals and healthcare facilities who have weakened immune systems.
Staph bacteria are a common causes of skin as well as pneumonia, surgical wound infections, and bloodstream infections.
Novartis turned in a record profit of SFr7.8 billion ($6.1 billion) with net sales of SFr41.7 billion in 2005.
Last year healthcare market researchers IMS Health rated Novartis as the fourth largest pharmaceutical in the world in terms of sales and estimated the Basel-based giant had a 5.05% share of the total market.
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