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Sanofi-Aventis Acquires Genzyme Corporation for $20 billion
GlobalData, May 2011, Pages: 5
Sanofi-Aventis Acquires Genzyme Corporation for $20 billion - Deal Analysis from GlobalData
Summary
Following acquisition by Sanofi-Aventis for about $20 billion, Genzyme Corporation will become a new platform in Sanofi-Aventis’s sustainable growth strategy and expand the company's presence in biotechnology targeting rare diseases, renal-endocrinology, hematology-oncology, and the biosurgery segment.
Genzyme will continue to operate out of its current headquarters in Massachusetts, and will be headed by Sanofi-Aventis CEO Christopher Viehbacher.
Genzyme had earlier rejected several offers from Sanofi-Aventis last year, which included a deal worth $18.5 billion, or $69 per share. The two companies ultimately settled on a price of $74 per share.
Scope
- On April 8, 2011, Sanofi-aventis completed the acquisition of Genzyme for about $20 billion in total, or $74 per share plus extra payments of up to $14 per share. The extra payments would depend on the achievement of commercial milestones of the leukemia drug Campath (alemtuzumab) in the multiple sclerosis (MS) therapy area, where it will be sold as Lemtrada, for which Genzyme executives estimated sales to reach $3.5 billion. They are also based on the production levels of Genzyme products Cerezyme (imiglucerase) and Fabrazyme (agalsidase beta), which had commercial setbacks following manufacturing issues in 2009.
Reasons to buy
- Several top selling products from Sanofi-Aventis such as Aprove, Lovenox, Multaq, Taxotere, and Plavix face competition from generic versions, and this acquisition can ensure considerable expansion into rare diseases, renal-endocrinology, hematology-oncology and the biosurgery segment.
- Genzyme's clinical research is focused on the areas of medicine where it markets commercial products, namely rare inherited diseases, renal disease, orthopedics, oncology, transplantation, and immune diseases. It also conducts research in cardiovascular disease, neurodegenerative diseases, and other areas with unmet medical needs. The company has product candidates across various stages of development, from pre-clinical studies to post-marketing studies.
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