S&C, Goodwin Lead on $10 Billion Amgen-Onyx Deal

, The Am Law Daily

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The health care industry's latest corporate takeover features the world's largest biotechnology company, Amgen, agreeing to acquire South San Francisco, California–based Onyx Pharmaceuticals and its portfolio of cancer-fighting drugs for $10.4 billion.

Announced Sunday, the transaction is among the largest in the pharmaceutical sector this year and a shot in the arm for a broader M&A market whose global deal value fell through the year's first half. Other major drug deals announced earlier this year include Pfizer's $13 billion sale of its remaining stock in animal health company Zoetis Inc. in June, and Actavis's $8.5 billion purchase of Irish generic drugmaker Warner Chilcott in May.

Amgen has been circling Onyx for months. The Thousand Oaks, California–based biotech giant made an unsolicited $10 billion offer for the target company in June— a bid Onyx rebuffed before putting itself up for sale later that month in hopes of attracting more suitors and a better price.

Amgen eventually agreed to pay $125 in cash for each Onyx share, up from the $120 per-share bid it submitted in June. The price represents a premium of almost 7 percent over Onyx's Friday closing price and a nearly 44 percent premium over Onyx's share price at the time of Amgen's initial offer. The deal is expected to close in the fourth quarter, pending regulatory approval.

By acquiring Onyx, Amgen aims to enhance its existing oncology portfolio with the addition of various anticancer drugs that include treatments for breast, colon, kidney, and liver cancers. The portfolio is led by Kyprolis, a treatment used for the bone marrow cancer known as multiple myeloma that Onyx acquired as part of its 2009 purchase of drug company Proteolix in a deal worth up to $851 million. The New York Times notes that Kyprolis, which U.S. regulators approved last year, had $125 million in sales in the first half of 2013 and could ultimately see annual sales approaching $2 billion if it is approved in Europe.

Sullivan & Cromwell is advising Amgen on the Onyx acquisition with a team that includes New York–based M&A partner Frank Aquila, who serves as Amgen's regular outside counsel. Corporate partners Matthew Hurd and Sarah Payne are also advising, along with executive compensation and benefits partner Matthew Friestedt, finance partner John Estes, tax partner Ronald Creamer, IP partner Nader Mousavi, IP special counsel Spencer Simon, and environmental special counsel Matthew Brennan.

S&C advised Amgen last year on the company's $1.16 billion purchase of another anticancer drug developer, Rockville, Maryland–based Micromet. In 2011, the firm worked on Amgen's acquisition of BioVex Group in a deal worth up to $1 billion.

The S&C associates working on the deal are Chris Beatty, Jeannette Braun, Mark Campbell, Raffaele DeMarco, Stephen Fisher, Mary Grendall, Jennifer Hitchcock, Alice Lee, Jennifer Lee, Rosita Lee, Stephen Miller, Steven Mungovan, Regina Readling, Andrew Rocks, James Shea, Michael Snypes, and Isaac Wheeler. Amgen's general counsel is David Scott.

Gibson, Dunn & Crutcher is representing Lazard in its role as financial adviser to Amgen. M&A cochair Barbara Becker, corporate partner Dennis Friedman, and associate John Van Name are handling the matter.

Onyx, meanwhile, has turned to a team from Goodwin Procter for legal advice on the transaction. Boston-based M&A partner Stuart Cable is leading the way for Goodwin Procter. M&A partner James Matarese, private equity partner Bradley Bugdanowitz, executive compensation partner Lynda Galligan, and technology companies partner Danielle Lauzon are also advising. Suzanne Shema is Onyx's general counsel.
 

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