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The Blog of Drug Discovery News

J&J and Crucell…But wait, there’s more!

If the recent action with sanofi-aventis and Genzyme has taught us anything (in the several articles on this blog and our website), the announcement of a potential merger or acquisition often means the beginning of protests and confusion. Get ready for another one of those rides, perhaps. Within hours of the announcement by Johnson & Johnson and Crucell that that latter is on the part toward becoming a vaccine division of the former, at least one Crucell investor is waving a red flag.

Today, on the heels of the announcement that Crucell and J&J were in the advanced process of negotiations for the shares of Crucell that J&J doesn’t already own for $2.3 billion (click here to read the story on our website), Crucell’s second-largest shareholder, private investment company Van Herk Groep, is chiming in with some serious reservations.

As Gertjan van der Baan, a director of Van Herk says, the offer to buy the rest of the Dutch company is too low and has come too early, and he calls the EUR24.75-per-share proposal (roughly $32.30 per share) “meager.” However, he declined to say whether Van Herk will tender its shares, saying that he will wait for the formal offer.

Van Herk Groep has a 9.6 percent stake in Crucell to J&J’s 17.9 percent, making its voice a pretty loud one. Van der Baan told Dow Jones Newswires that he thinks Crucell is in a transition phase and has the revenue potential of a biotech company along with the low risk profile one tends to see in other pharma companies.

On a more positive note, Jack Jonk, head of equities at Delta Lloyd Asset Management—which owns between 4 percent and 5 percent of Crucell’s stock—says the proposal seems to be a move “in the right direction” and one that makes sense strategically.

“But it’s to early now to assess [the bid] so we’re going to take our time to study it,” he said.

One thing that analysts seemed united on is the low potential for any bidding war over Crucell, in part because J&J already owns such a significant chunk of the company.

About a year ago, J&J paid $443.5 million for the nearly 18 percent stake in the Dutch biotech, and the two companies also forged a pact at that time, initially concentrating on advancing a universal flu-mAb antibody that can treat and prevent all influenza A strains, including swine and bird flu. Long-term strategies at the time were to develop a universal influenza vaccine as well as monoclonal antibodies and vaccines directed against up to three other infectious and non-infectious disease targets.

“Despite significant advances in prevention and treatment, influenza remains a major health threat, and each year, vaccines must be formulated to address the current influenza strain,” Paul Stoffels, the global head of pharmaceuticals R&D at Johnson & Johnson said at the time. “A universal antibody or vaccine that protects against a broad range of strains would be an important advance in helping doctors and nurses manage the annual influenza season and control acute epidemic and pandemic outbreaks.”

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September 17, 2010 - Posted by | Corporate, M&A activity | , , , ,

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