GlaxoSmithKline is expected to announce a deal to acquire Human Genome Sciences worth $2.8bn after increasing its offer.
Reuters is reporting that UK-based GlaxoSmithKline will pay approximately $14 for each share for the US-based biotech company, an increase over the $13 per share offer that GSK belligerently stood by for three months.
GSK has pursued HGS since April, when it offered to acquire the company following a productive relationship, culminating in the development of lupus drug Benlysta.
However, GSK’s takeover approach was rejected out of hand by HGS officials, who dismissed the bid. Some HGS officials even accused GSK of waiting until the company’s share price reached rock bottom before making its approach. HGS responded by adopting a ‘poison pill’ approach to fend off GSK’s interest, resulting in an increasingly bitter stand-off.
Although sources have since revealed to Reuters that GSK’s decision to increase its offer has been welcomed, and a deal is expected to be announced before the opening of the US stock market on 16 July, with last-minute details still being finalised.
The deal will see GSK acquire full rights to lupus medication Benlysta, as well as other experimental medicines that the two companies had been collaborating on.
An increasing number of biotechnology firms similar to HGS are being courted by Big Pharma, as companies seek to revitalise product portfolios that are suffering at the hands of patent expiries and generic competition.
The deal follows Bristol-Myers Squibb and AstraZeneca‘s joint acquisition of Amylin Pharmaceuticals, with both companies sharing the $7bn bill.
Image: GlaxoSmithKline’s corporate headquarters, located in London, England. Photo: courtesy of GlaxoSmithKline.