BASEL: Jean-Pierre Garnier is facing his biggest corporate challenge since stepping down as CEO of GlaxoSmithKline Plc in 2008. As chairman of Actelion Ltd., it’s up to him to ensure the biotech’s shareholders aren’t left shortchanged after a takeover approach by Johnson & Johnson.
Shortchanged in this case is unlikely to mean Actelion being sold on the cheap. J&J has suggested it could pay more than 250 Swiss francs per share for the pulmonary hypertension specialist, according to Bloomberg News. That proposal, valuing it at some 26.6 billion Swiss francs ($26.3 billion) including net cash, came after an initial 246 Swiss franc offer was rebuffed.
Such a price looks acceptable on any conventional assessment. It would be a 56 percent premium to the Actelion shares’ six-month average and a 44 percent premium to their all-time high touched only in July. But in biotech such conventions count for little.
Could Actelion get to that level in the next 18-24 months by going it alone? Perhaps. The stock rose by a compound yearly average of 44 percent between 2012 and 2015. That followed the company’s success in launching medicines to succeed its core Tracleer drug, which came off patent last year. Still, the shares have slowed in 2016 and it’s hard to see where the next leg up comes from. The future generation of drugs will take considerable time and investment.
