Merck, Allergan Suggested As Suitors But Biogen's Attractiveness Under Question
Biogen's share price has risen on speculation that it is an acquisition target for Merck & Co and Allergan. But with a number of uncertainties hanging over the company, can Biogen negotiate a premium price?
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More and larger M&A deals could boost public biopharmaceutical companies, so investors will watch closely to see if Pfizer's $14bn Medivation acquisition kicks off a widespread spending spree. Speculation about who'll be bought next is in full swing.
Allergan PLC has $27.6m in cash after closing the $40.5bn sale of its generics business to Teva Pharmaceutical Industries Ltd. and paying down $9.3bn debt, but the company will rely on blockbuster sales gains and recent launches for revenue and earnings growth, not a big acquisition.
Earnings announcements from Teva and clinical trial results from Biogen, Ionis and Sage have turned out to have quite different interpretations in retrospect. Exciting news can sometimes look more like a vehicle for strategically timed stock promotion than a genuine material event.