Biologic drugs are becoming increasingly important in pharma
portfolios, and South Korea's Celltrion is all about biologics. So it is no wonder if
there is a behind-the-scenes bidding war going on to buy control of the
company.
Media have reported that
Celltrion Chairman Seo Jung Jin planned to sell his $1.3 billion stake in the
company and two affiliates to a "multinational" pharma company, and
Celltrion has confirmed that its largest shareholder is looking to cash out.
Rumors have persisted for months that AstraZeneca ($AZN) was interested. But Celltrion's shares jumped
nearly 10% today, Reuters reports, after South Korean media said that
Roche ($RHHBY) and Teva Pharmaceutical Industries ($TEVA) might be in the mix as well.
The reasons AstraZeneca
might want Celltrion are pretty straightforward. AstraZeneca CEO Pascal Soriot is eager for any stable sources of revenue as
the company fights through patent losses. Sales of AstraZeneca's antipsychotic
blockbuster Seroquel have fallen precipitously since losing patent
protection, and stomach blockbuster Nexium faces the same fate this year. Celltrion could
help it with development of its biologics portfolio.
Teva is in much the same
situation with generic competition for its workhorse drug, multiple sclerosis treatment Copaxone, slated to begin in May. It also has struggled
to get a foothold in the production of biosimilars, the generic versions of biologic drugs, a
field that Celltrion is considered a leader in.
Roche might have different
interests. It already has a strong portfolio of biologic drugs, some of which
are the targets of biosimilars, and nearly 40 more in its pipeline. It has
started an $880 million buildup of its own biologics manufacturing capacity.
Buying Celltrion would give it a modern biologics facility in a prime location,
as well as expertise. Asia has become a hub for biologics manufacturing, in
part because the region's governments are offering deals to attract foreign
interest. Some have said the trend will lead to innovations that will slash manufacturing
costs for both biosimilars and new biologics.
As for Celltrion, it
declined Reuters' request to comment about any of this.