Sanofi shares move lower after securing Ablynx deal ahead of Novo Nordisk

Ablynx' caplacizumab vials

Under the terms of the Ablynx deal, Sanofi will pay €45 a share in cash, 47 per cent more than what Novo Nordisk had offered earlier this month and 135 per cent more than Ablynx's share price before Novo first tabled its offer in December.

The company's last takeover was in 2011 when they acquired US biotech company Genzyme for $20 billion.

Sanofi's CEO Olivier Brandicourt said, "With Ablynx, we continue to advance the strategic transformation of our Research and Development, expanding our late-stage pipeline and strengthening our platform for growth in rare blood disorders". Last week the company announced it was to acquire U.S. biotech group Bioverativ for $11.6bn.

"We have a strong balance sheet".

Both Pfizer and Merck KGaA are now looking to divest consumer health businesses.

As a number of larger pharmaceutical firms are seeking to expand their potential offerings through the purchase of smaller, focused biotech companies, this latest purchase underscores Sanofi's ambition to break new ground and deliver value to its investors, too.

According to Ablynx their small size means Nanobodies can bind multiple therapeutic targets, including those that cannot be accessed by conventional antibodies. It was the biggest deal in 7 years, part of their new plan to strengthen their presence in the rare blood diseases market.

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Berenberg analysts said Ablynx was a good fit but they estimated the deal would generate no more than a 4 percent return on invested capital, assuming caplacizumab sales of around 400 million euros by 2023.

The agreed acquisition will add Ablynx's phase III thrombosis antibody-fragment candidate caplacizumab to Sanofi's pipeline, as well as adding a single-domain antibody - or "Nanobody" - technology to its capabilities.

That remains a challenge for CEO Lars Fruergaard Jorgensen, who took over a year ago, and has previously stated that Novo Nordisk needs external innovation to broaden its product line-up.

Image: Ablynx to be acquired by Sanofi in a deal worth about €3.9bn.

Sanofi lost out on buying California-based cancer specialist Medivation to Pfizer in 2016, and also missed acquiring Swiss biotech company Actelion, which was bought by Johnson & Johnson previous year.

The transaction was unanimously approved by the boards of both companies.

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