Sanofi Nears Deal to Buy Hemophilia Drugmaker Bioverativ for More Than $11.5 Billion -- Update

Sanofi SA is nearing a deal to buy hemophilia drugmaker Bioverativ Inc. for more than $11.5 billion as the French drugmaker looks set to clinch a big deal while it braces for generic competition for its top-selling product.

A deal, which could be announced as soon as Monday, would value the former Biogen Inc. unit at $105 a share, according to people familiar with the matter. The price would represent a 63% premium to where Bioverativ closed trading Friday. It is possible the talks could fall apart before a deal is reached.

Sanofi has been looking to add to its portfolio as generic-drug companies prepare to launch lower-priced versions of Lantus insulin, its best-seller. Lantus accounted for EUR3.5 billion ($4.3 billion) of Sanofi's EUR26.4 billion in sales during the first nine months of last year.

But Sanofi has missed out on a number of deals. In 2016, the company kicked off a bidding war for U.S. biotechnology firm Medivation Inc. Sanofi's offer for the company caused other bidders to pile in, and Medivation signed a deal to sell itself to Pfizer Inc. for $14 billion. Sanofi also lost out to Johnson & Johnson last year in its pursuit of Swiss biotech Actelion Pharmaceuticals Ltd.

The market is getting more competitive, however, with longtime players like Shire PLC, Novo Nordisk A/S and Pfizer facing new rivalry from heavyweight Roche Holding AG.

Sanofi has been a leading player treating rare diseases since paying more than $20 billion for Genzyme in 2011. Rare-disease drugs are a growing part of the Paris company's lineup, with EUR2.2 billion in sales during the first nine months of 2017, up more than 5% from the same period a year earlier.

Bioverativ consists of the hemophilia drugs from Biogen, one of the biggest biotech concerns, which spun off the business last year. On its first day of trading roughly a year ago, the shares closed at less than $46.

Bioverativ's two big products, Eloctate and Alprolix, are among the leading treatments for two of the most prevalent types of hemophilia, known as A and B. Bioverativ reported $291.6 million in revenue from the two drugs during the third quarter of 2017.

One issue for Sanofi: it wouldn't sell the pair of drugs in its home market. Bioverativ owns the rights to Eloctate and Alprolix in North America and other countries around the world, but Swedish Orphan Biovitrum AB has the rights in Europe, Russia and many countries in the Middle East and North Africa.

The lofty premium would represent a win for Bioverativ shareholders, including activist hedge-fund manager Alex Denner of Sarissa Capital Management LP, who sits on the boards of Bioverativ and Biogen. A deal for Bioverativ would come a year after Ariad Pharmaceuticals agreed to sell itself to Takeda Pharmaceutical Ltd. for $4.7 billion, or a roughly 75% premium to where Ariad was trading before the deal. Mr. Denner was Ariad's chairman at the time.

Write to Dana Mattioli at dana.mattioli@wsj.com and Jonathan D. Rockoff at Jonathan.Rockoff@wsj.com

(END) Dow Jones Newswires

January 21, 2018 20:52 ET (01:52 GMT)