Shire has agreed to buy U.S. group NPS Pharmaceuticals for $5.2 billion. As Hayley Platt reports the Dublin-based drugmaker's biggest acquisition yet is seen as a bid to strengthen its position in the lucrative field of medicines for rare diseases.
It's their biggest acquisition yet. Just three months after Shire failed to sell itself to AbbVie, it has agreed to buy NPS Pharmaceuticals. The deal will give Shire access to two significant new drugs. Gattex, a treatment for short-bowel syndrome, already on the market. And Natpara, a drug for the rare hormonal disorder hypoparathyroidism, currently awaiting U.S. approval. Shire's CEO said the tie-up was "about growth and rare diseases, it fits hand in glove with our strategy and our franchise," he said Dublin-based Shire will pay $46 per share for the U.S. biotech group. That's around 50% more than their value before the bid. The all-cash deal is worth $5.2 billion - $1.6 billion of that came from the breakup fee it secured after the collapse of the AbbVie tie-up last October. Shire hopes to make cost savings of up to 35 percent - but shares fell back after an initial rise. Brenda Kelly is a market strategist at IG. SOUNDBITE: Brenda Kelly, Market Analyst, IG, saying (English): "Certainly it's very difficult seeing Shire breaking above the fifty marker despite the fact that this is seen as a positive move for the company. Certainly it does strengthen it's position in the field of medicine for rare diseases." Swiss drugmaker Roche has also been shopping. It's spending $1.8bln on a majority stake in Foundation Medicine - a cancer care specialist. But the sector isn't expected to be as busy as last year - thanks to regulatory changes in the U.S. SOUNDBITE: Brenda Kelly, Market Analyst, IG, saying (English): "Certainly the pull back in terms of the tax advantages for some of the US companies does tend to dampen that scenario over the coming years. Particularly in regards to any U.S./European tieup." Shire will have to wait two weeks before it finds out if Natpara will be approved. If all goes well it may seek further deals as it seeks aims to become a biotech powerhouse.