Has Onyx become too dear a treasure to find a buyer?

Pfizer reportedly drops out of the running to bid on acquiring Onyx Pharmaceuticals Inc.

Jeffrey Bouley
SOUTH SAN FRANCISCO, Calif.—As we reported previously in the article "Onyx may be a precious gem right now for eager Big Pharmas," Onyx Pharmaceuticals Inc. rejected a $120-per-share unsolicited acquisition offer from Amgen Inc. as being too low, and the stock prices for Onyx jumped sharply from their previous dollar amount in the mid- to high-80s to range between $8 and $10 higher than Amgen's bid since the announcement. However, that jump may not bode well for Onyx, as Reuters reports from unnamed inside sources that Pfizer has already dropped out of the running to bid on Onyx, finding the price a bit too high.
 
As Reuters notes, that leaves Amgen in the front of the pack still; also, according to those inside sources, other potential suitors like Gilead Sciences Inc., Bristol-Myers Squibb Co. and AstraZeneca also seem to be balking at the potential price of an Onyx acquisition right now.
 
Early on in the auction process, which Onyx and the other companies have kept hush-hush so far, analysts were predicting a variety of possible sale prices, many of them well over Amgen's bid. Whether those predictions will hold now that there is some trepidation among bidders and potential bidders remains to be seen. It also remains to be seen whether Onyx will continue to find $120 per share too low if no one bids higher.
 
Zacks Investment Research had predicted that if a deal ultimately goes through, it will do soat close to $130 per share, while Deutsche Bank predicted the price could go to $148per share, Sanford C. Bernstein thought a price of $180 per share wasn't out of the range of possibility and Leerink Swann thought it could go as high as $140.
 
 

Jeffrey Bouley

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