Wednesday, December 14, 2005

Amgen + Abgenix = Good Deal

This is a smart acquisition by Amgen (AMGN). Today Amgen made a bid to purchase its partner Abgenix (ABGX) for $2.2 billion in cash. This acquisition will be dilutive to Amgen’s earnings for the next two years. With the acquisition, Amgen gains all the rights to panitumumab, a drug used to treat colon cancer. Investor's liked the deal and sent Amgen shares up 3.2% to $79.25 in after hours trading. Amgen is projecting peak sales of ~$2 billion / yr for this drug, but a few analysts think Amgen's estimates are too low. I've seen estimates for peak sales of this drug around ~ $3 billion / yr. These are just staggering numbers for a drug that hasn't even received FDA approval. Amgen obviously has plenty of confidence in this drug! Amgen's going higher...


Post a Comment

<< Home