BeiGene Shares Take Off on Amgen's USD2.7 Billion Buy-In
Xu Wei
DATE:  Nov 02 2019
/ SOURCE:  yicai
BeiGene Shares Take Off on Amgen's USD2.7 Billion Buy-In BeiGene Shares Take Off on Amgen's USD2.7 Billion Buy-In

(Yicai Global) Nov. 1 – BeiGene's shares soared 25 percent in after-hours trading after the Chinese biopharma company said Amgen would buy USD2.7 billion worth of its equity, the sector's largest-ever China-US deal.

The Beijing-based target's shares [NASDAQ:BGNE] traded at USD172.99 apiece at 8 p.m. local time in New York, after a post-close peak at USD180. Amgen's shares [NASDAQ:AMGN] were largely unmoved at USD213.20 as of 6.31 p.m.

Amgen, whose best-selling product Neulasta helps prevent infections in patients undergoing chemotherapy, plans to acquire 20.5 percent of BeiGene in cash, the target said in a statement today. The buyer will pay USD174.85 a share, 36 percent more than Nasdaq-listed BeiGene's average over the 30 trading days to Oct. 30, and will likely become the firm's largest shareholder.

The previous biggest biopharma deal between the US and China was when BeiGene and New Jersey-based Celgene struck a USD1.4 billion cooperative deal in 2017 to develop and sell BeiGene's immunotherapy treatment for solid tumor cancers.

Amgen and BeiGene, which specializes in cancer treatments, plan to work together once their deal is done to commercialize three of the former's products in China and split profits evenly over a five- or seven-year period. Once that agreement expires, BeiGene can continue to sell one of the drugs and will be entitled to royalties for the remaining two for the proceeding five years.

The pair will also collaborate to develop 20 anti-tumor drugs, with BeiGene footing up to USD1.25 billion of the research costs through cash and services rendered, and receiving entitlement to earn royalties on the sale of any co-designed products that sell outside of China.

Editor: James Boynton

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Keywords:   BeiGene,Amgen