Novartis to buy out Chiron
Here's news that relates to announced plans by the US and other governments to finance and buy up any avian-flu vaccines.
We reported earlier a $4.5 billion bid by Swiss-based Novartis for the remainder of US vaccine company Chiron, a company in which Novartis had a minority position. Chiron refused, and the issue clearly was money. The final figure of $5.1 billion was announced this week.
It's a big move for Novartis, which has been an aggressive acquirer this year. As a Wall Street Journal article notes ("Novartis to Buy Rest of Chiron In Deal Valued at $5.1 Billion", 10/31/2005):
The takeover of Chiron marks Novartis's third big acquisition this year, following the Basel-based company's purchase of two big generics makers for a total of $8.3 billion. Novartis also paid $660 million for Bristol-Myers Squibb's prescription-free drug brands.
Taken together, these betoken a move away from reliance on patented prescription drugs. The vaccine sector, once the neglected stepchild of the drug industry, is heating up.
The same WSJ story indicates that analysts believe the vaccine industry will take off this decade, "expected to more than double sales in the next five years to more than $20 billion in 2009 from about $9.6 billion in 2004."
Chiron, the world's #5 vaccine company, had trouble competing against better-heeled pharmaceutical companies it was competing against, namely Merck, Aventis-Sanofi, Wyeth, and GlaxoSmithKline.
Chiron also had manufacturing difficulties that caused the rejection of crucially needed flu vaccines last year. It is thought that Novartis has the money and will to upgrade and expand the Chiron operations. Novartis's CEO has already declared he is looking at smaller vaccine start-ups with intent to purchase. One firm talked about in this way is Swiss vaccine maker Berna Biotech AG,
