Shire has agreed to sell its cancer drugs business to French drugmaker Servier for $2.4bn, even as it prepared for a possible takeover offer from Takeda.
The Dublin-based company said the deal covers its already-marketed drug Oncaspar (pergaspargase) for acute lymphoblastic leukaemia (ALL), as well as ex-US rights to pancreatic cancer therapy Onivyde (irinotecan pegylated liposomal formulation) and long-acting Oncaspar follow-up calaspargase pegol – under FDA review for ALL.
The agreement comes as Takeda’s chief executive Christophe Weber is reported to be in the US canvassing investor support for a potential bid for Shire, and will no doubt complicate attempts to put a fair value on the business with just a few days to go before the Japanese company must propose an offer or press pause for six months as required under EU takeover laws.
Oncaspar and the other cancer assets were acquired by Shire as part of its takeover of Baxalta in 2016, and contributed $262m out of total group sales of $14.5bn last year, rising at a healthy pro forma rate of 22%. Oncology is therefore a small part of Shire’s business, but was highlighted by Takeda as one of three therapeutic categories that could be bolstered by merging the two companies.
Explaining the move, Shire CEO Flemming Ornskov said that “while the oncology business has delivered high growth and profitability, we have concluded that it is not core to Shire’s longer-term strategy”, which lies mainly in rare diseases.
He added that the money raised from the transaction “increases optionality” for the company and may be deployed to buy back shares “after the current offer period regarding Takeda’s possible offer for Shire concludes” on 25 April.
A report in the Telegraph suggests that Takeda may struggle to raise the cash to acquire Shire – which could have a price tag as high as £35bn (around $50bn) – and is considering splitting up Shire and selling its neuroscience division to help finance the deal. The neuroscience arm includes Shire’s attention-deficit hyperactivity drugs such as Adderall XR (mixed amphetamine salts) and brought in $2.66bn in sales last year.
Meanwhile, Servier group president Olivier Laureau said the acquisition will enable the company to “meet its strategic ambitions to become a global key player in oncology”, in particular by helping it establish a direct commercial presence in the US.