TOKYO (Reuters) – Japanese drugmaker Daiichi Sankyo denied on Thursday it received a takeover bid last year from Britain’s AstraZeneca, following speculation that sent its share price soaring as much as 13 percent and triggered a trade suspension.
The online version of the magazine Nikkei Business earlier reported that AstraZeneca had offered to buy Daiichi Sankyo, which has a market value of about $16 billion, in 2016 but the Japanese company declined the approach.
“It was today reported by Nikkei Business that Daiichi Sankyo Co Ltd received the acquisition offer from AstraZeneca. However, this is not the fact,” the company said in a brief statement.
AstraZeneca declined to comment when contacted by Reuters.
The two firms have a long-standing relationship which includes a 2015 agreement to jointly commercialise constipation drug Movantik in the United States, and a 2010 deal to supply and promote blockbuster heartburn treatment Nexium in Japan.
Daiichi Sankyo also has an interest in cancer, given its expertise in antibody drug conjugates, a new kind of “armed antibody” that can carry a cancer-killing payload to tumour cells, which could complement AstraZeneca’s work in the field.
Last month, AstraZeneca’s prospects in cancer suffered a setback when a closely watched immunotherapy combination treatment failed to help patients as hoped. [nL5N1KI1ZJ]
That led to speculation of AstraZeneca itself becoming a takeover target. [nL5N1KN1HX]
The drugmaker has been banking on cancer treatment to help revive its fortunes following a wave of patent expirations on its biggest products, but a decline in cash flow could impact its ability to make any major acquisitions.
It has “limited flexibility around the balance sheet”, Goldman Sachs analysts said in a report this week, given a need for ongoing investment and commitments to prior acquisitions, including Acerta, for which it has further payment obligations.
At Daiichi Sankyo, the Japanese drugmaker earlier this year said it would spend 15 billion yen ($136 million) to raise production of antibody drug conjugates.
On Wednesday it announced a tie-up to test a combination of its antibody drug conjugate DS-8201 with immuno-oncology drug Opdivo from Bristol-Myers Squibb Co. [nL4N1LE5FS]
Daiichi Sankyo’s share price was up 5 percent when trading was suspended. AstraZeneca was 2 percent higher in afternoon trade in London, amid hopes for better news for its cancer drugs at a major medical congress in Madrid next week. [nL8N1LH479]
($1 = 110.4700 yen)
Reporting by Sam Nussey; Additional reporting by Ben Hirschler; Editing by Christopher Cushing and Keith Weir