Rumors Again Swirl Over BioMarin Being a Possible Plan B for Sanofi

Published: Aug 23, 2016

Rumors Again Swirl Over BioMarin Being a Possible Plan B for Sanofi August 22, 2016
By Alex Keown, Breaking News Staff

NOVATA, Calif. – Shares of BioMarin are up nearly 6 percent this morning as rumors flew that Sanofi was eying the company after losing out to Pfizer in acquiring Medivation .

This is not the first time the company has been considered as a possible target for Sanofi as a backup plan. That rumor has been going around for more than a month and was highlighted in July when BioMarin was rumored to be a takeover target for Swiss-based Roche .

The rumor resurfaced this morning in a report by The Street, which cited a Jeffries analyst note. However, at this time it appears to be just rumors. In fact, the company may not even be on Sanofi’s target list. A Goldman Sachs note, cited by The Street, also indicated other rare disease drug companies such as Amicus and Ultragenyx could be takeover targets.

This is not the first time BioMarin has been talked of as a target for acquisition. As previously noted, the company was considered a target for Roche in July. Rumors about Roche’s interest in BioMarin were first reported on the U.K. blog, Betaville. Citing unnamed sources familiar with the matter, Betaville said Roche has been interested in approaching the company, but held off an earlier approach due to uncertainty how the Brexit vote would impact the market. This is not the first time Roche has been rumored to target BioMarin, CNBC said in July. In 2013, the Swiss drugmaker was rumored to have lined up a $15 billion proposal for the company and its orphan drug line, but no move was made.

Analysts at The Street are not keen on BioMarin stock, rating it as a sell due to multiple weaknesses. Those weaknesses at BioMarin include “feeble growth in its earnings per share, deteriorating net income, disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself,” according to The Street’s analysis.

The company did face some challenges with its investors due to efficacy questions about its phenylketonuria drug pegvaliase, developed to treat the buildup of the amino acid phenylalanine in patients. However, the company was able to breathe a sigh of relief when its late-stage treatment for Batten disease met its goal.

Despite the company’s tough economic challenges, BioMarin has a number of promising experimental drugs in its pipeline, including BMN 190 (cerliponase alfa) for a rare neurodegenerative disease, CLN2, its phenylketonuria candidate pegvaliase, and, of course, BMN 270. In April, BioMarin reported preliminary data from the Phase I/II trial of BMN 270 that were quite positive. Earlier this year, Jean-Jacques Bienaimé, BioMarin’s chief executive officer predicted 2016 to be a billion dollar year, however the company has seen some stumbles due, in large part, to the failure of its Kyndrisa (drisapersen) program for Duchenne muscular dystrophy (DMD).

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