Theravance jumps on GSK takeout rumor
Theravance Inc. (NASDAQ:THRX) jumped $3.37 (16%) to $24.29 on Monday after a Piper Jaffray analyst suggested Theravance's partner GlaxoSmithKline plc (LSE:GSK; NYSE:GSK) may acquire the biotech for about $3.6 billion. Analyst Ian Somaiya said in a note that GSK could acquire the 73.2% of Theravance it does not already own for $51 per share, or about $3.6 billion. The price is a 144% premium to Theravance's close of $20.92 on Friday, before the note was released.
Somaiya believes a positive outcome of a Thursday meeting of FDA's Pulmonary-Allergy Drugs Advisory Committee to discuss an NDA for the partners' Breo fluticasone furoate/vilanterol to treat chronic obstructive pulmonary disease (COPD) could be a "prelude" to an acquisition. His $3.6 billion takeout value for Theravance is based on the net present value of GSK's potential royalty payments to the biotech for three respiratory products, including Breo, under a 2002 deal to develop compounds to treat asthma and COPD. ...