Mike Boyer reports
Shares of drug-maker Amylin Pharmaceuticals Inc. soared 54 percent Wednesday after a report that the company rejected a $3.5 billion unsolicited takeover bid from Bristol-Myers Squibb Co.
Shares of the San Diego-based company closed at $23.77 – up $8.38 in more than 10 times normal trading – after Bloomberg News reported the company had rejected the $22-a-share offer. Bloomberg, citing two unnamed sources, said the offer was made and turned down last month.
Both companies declined comment. But the premium, about 43 percent more than Amylin’s Tuesday close of $15.39, spurred a buying spree on Wednesday.
Bloomberg said Bristol-Myers hasn’t approached Amylin since it rejected the offer, which excluded Amylin’s $2 billion in debt.
In late January, after several years of trying, Amylin got Food and Drug Administration approval to begin U.S. marketing of the first once-a-week diabetes injection drug Bydureon.
It’s produced at the company’s $700 million manufacturing plant and distribution center off Port Union Road in West Chester, where 400 are employed.
The FDA approval came after two previous rejections in 2010, when the agency asked Amylin for a new study of the drug’s effects on the heart.
Bydureon is part of a class of drugs that work by increasing the body’s insulin production to treat Type 2 diabetes. Amylin says Bydureon’s once-a-week injection is more convenient than other treatments requiring daily injections.
Diabetes, mostly Type 2, affects nearly 26 million people in the U.S. and 347 million adults worldwide. In this country, diabetes costs more than $174 billion a year in direct and indirect medical expenses, Amylin says.
Some analysts believe Bydureon could generate revenues approaching $1 billion in a few years. The drug has been on sale in Europe since last year.
Amylin is looking for a new marketing partner for the drug after severing its business relationship with Indianapolis-based Eli Lilly and Co. last November after Lilly struck a deal with an Amylin competitor.
Two years ago activist investor Carl Icahn, who owns 10 percent of Amylin, waged a proxy fight that gave him two seats on Amylin’s board.