Shire sells cancer drugs to Servier for $2.4-billion as Takeda circles

Shire specialises in drugs for rare diseases

Shire specialises in drugs for rare diseases

Takeda said in March it was considering a bid for Shire and identified its oncology business as one of the main reasons for its interest.

Shares in Ireland-based biotech Shire have zoomed up two per cent this morning after it revealed it will sell its oncology business to France's Servier for $2.4bn (£1.7bn) as it seeks to become a leader in rare disease treatment.

"We will continue to evaluate our portfolio for opportunities to unlock further value and sharpen our focus on rare disease leadership with selective disposals of non-strategic assets".

Takeda said earlier this year that it might make an offer for Shire to beef up its core therapeutic areas. One analyst said that the unit was considered to be non-core for Shire. Takeda declined to comment further on Monday.

Buying Shire would be transformational for Takeda but would be a huge financial stretch, since the company is worth around $10-billion more than the Japanese group.

"The proceeds from the transaction increase optionality and Shire's Board will consider returning the proceeds of the sale to shareholders through a shareholder-approved share buyback after the current offer period regarding Takeda's possible offer for Shire concludes".

Shire itself also has a track record of acquisitions, but its biggest ever deal - the $32- billion purchase of Baxalta in 2016 - was widely criticized by shareholders.

The Oncology business consists of in-market products ONCASPAR, or pegaspargase, a component of multi-agent treatment for acute lymphoblastic leukaemia and ex-US rights to ONIVYDE, a component for the treatment of metastatic pancreatic cancer. Those and all other early-stage immuno-oncology pipeline collaborations will now go to Servier. Shire's board began considering a sale of the oncology business in December.

For privately held Servier, acquiring Shire's oncology operation allows it to establish a direct commercial presence in the United States and boosts its presence in cancer.

Latest News