Thursday, April 12, 2007

Strategic Alternatives: MedImmune Edition

Medimmune is exploring strategic alternatives, including a possible sale of the company, with the help of bankers Goldman Sachs. Investors apparently like the idea: MEDI shares (already up 20% in the past couple months) are up more than 12% this morning and knocking against five-year highs, and the company's valuation has broken through the $10 billion barrier.

And why wouldn't they? All signs point to sweet takeout valuations by pharma desperate to beef up pipelines. Schering's takeover of Organon is in the same ballpark, valuation wise, and while Medimmune can't boast five products in Phase III studies like Organon, it's pipeline is arguably broader and deeper. Plus Medimmune operates in vaccines and biologics, two sought-after capabilities in Big Pharma these days, and is growing at a nice clip: on Monday the company announced that it expected first quarter earnings to triple over 2006.

MedImmune has suggested it is interest from certain pharmaceutical companies and dissatisfaction on the part of certain shareholders (i'm looking at you, Carl Icahn) that led to the move.

No comments: