Aug. 26 - Amgen looks to plug holes in its drug pipeline with finally reaching a deal to acquire Onyx Pharmaceuticals for $10.4 billion. Conway G. Gittens reports.
How do you re-build your pipeline in the biotech world? You buy it. Amgen is plopping down $10.4 billion for Onyx Pharmaceuticals after trying to seal the deal for two-months. That all cash price tag makes this the fifth largest biotech deal on record. CEO Bob Bradway has been gobbling up companies and their products, with two of Amgen's revenue drivers now facing safety concerns and four of its five top-selling treatments facing patent expirations beginning in 2015. So does that Onyx buy go far enough? No, says the team at Stifel Nicolas. According to a note: "While we see the ONYX acquisition improving Amgen's long-term EPS growth profile, we continue to see other large-cap biotech peers as more attractive." Stifel has buy ratings on Gilead, Celgene and Biogen Idec but only a hold on Amgen. Shares of Amgen - up for the day and up about 30 percent y-t-d, which is pretty much in line with the sector.