February 11, 2015
By Mark Terry, BioSpace.com Breaking News Staff
Laval, Quebec-based Valeant Pharmaceuticals International, Inc. announced yesterday that its $400 million cash bid for bankrupt Seattle-based Dendreon Corporation assets has won.
On Jan. 29, 2015, Valeant announced that it had made a “stalking horse” bid of $296 million for assets of Dendreon Corporation (DNDN). A stalking-horse bid is an initial floor bid that creates a low threshold in order to avoid low bids on assets.
Dendreon announced bankruptcy on Nov. 10, 2014. Part of the Chapter 11 agreement allowed the company to continue selling its prostate cancer drug Provenge.
Now, as the final dealValeant will acquire Provenge as well as other assets for $400 million in cash. The company will apply for court approval on Feb. 20 and hopes to close the deal by the end of the month.
A competing joint bid was made by US Worldmeds of Matthews, Ky., and New York investment firm Deerfield Management. The joint offer did not meet Valeant’s higher bid.
“We believe that oncology has similar characteristics to our current therapeutic portfolios, such as strong growth, high durability, strong patient and physician loyalty, and a terrific reimbursement regime,” said J. Michael Pearson,
Valeant chairman and chief executive officer in a statement. “We have not previously found an economic way to enter this market, but with the unique dynamics of this situation, we believe that this transaction will create significant shareholder value.”
“We are confident that Valeant will be a strong owner for Provenge and patients will be able to receive treatments with no disruption moving forward,” said Dendreon president and CEO Thomas Amick in a statement. “We want to thank our employees whose continued hard work, dedication and commitment to serving our physicians and their patients enabled us to move through this process.”
Amick came out of retirement in August to replace former Dendreon president and CEO John Johnson. Amick had a long career with Johnson & Johnson and prior to his retirement was chairman and chief executive officer of Discovery Labs from 2010 through 2012. When it declared bankruptcy in August, Dendreon indicated there was a possibility the company would not be able to pay off its $620 million debt. Although Provenge was a very promising drug, it came with a price tag of $93,000 for a course of treatment, and was not quickly adopted by doctors and faced some headwinds from payers. “Dendreon combined undue optimism in sales projections with excessive risk in its capital structure,” said Erik Gordon, professor at the University of Michigan’s Ross School of Business in a statement. “It is a case of moderate product success and immoderate management failure.”
BioSpace Temperature Poll
Who Do You Think Will Be Sanofi’s New CEO? French drugmaker Sanofi said Thursday that it will name a new chief executive in mere weeks, as it attempted to put to rest rumors that the company could not find any executives willing to take the reins after it unceremoniously ousted its previous CEO last fall. Who do you think will soon be crowned king? BioSpace wants your opinion!
