Biogen Idec Inc. said it is prepared to run a proxy contest to gain control over Facet Biotech Corp.'s board, in the latest maneuver by the big biotech to acquire the Redwood City, Calif.-based company.
Earlier this month, Cambridge, Mass.-based Biogen upped its bid to $17.50 per share, calling it the "best and final offer," and gave shareholders until midnight Dec. 16 to tender their shares. Facet's board previously rejected a $14.50-per-share offer - dropped from the initial $15-per-share bid following Facet's deal with Trubion Pharmaceuticals Inc. (See BioWorld Today, Sept. 8, 2009, Sept. 22, 2009, and Dec. 7, 2009.)
The latest offer would value Facet at about $438 million.
If Facet shareholders tender a majority of the company's outstanding shares before the offer expires, "and the Facet board refuses to listen to the explicit wishes of its stockholders," Biogen said it will seek to replace at least a majority of the directors on Facet's board.
Biogen has defended its offering price, stating that it already owns half of daclizumab, a CD25 antibody moving into Phase III trials in multiple sclerosis, and volociximab, a midstage cancer drug. Both drugs were partnered with Biogen in 2005, before Facet was spun out of parent firm PDL BioPharma Inc.
Facet had about $350 million in cash as of Sept. 30, but Biogen has argued that costs associated with the recent Trubion deal and expensive lease obligations have lowered the smaller firm's cash value. Facet's board has continued to urge shareholders not to tender their shares.
The company also said Tuesday afternoon that it agreed to amend its rights amendment to allow its largest shareholder, Biotechnology Value Fund, to increase its ownership limit from 15 percent to 20 percent of the total outstanding shares. BVF has informed Facet that it does not intend to tender its shares of common stock into Biogen's latest tender offer.
Shares of Facet (NASDAQ:FACT) closed at $16.75 Tuesday, down 31 cents, while shares of Biogen (NASDAQ:BIIB) gained 56 cents to close at $49.43.