Sanofi makes move to remove Medivation board; Medivation hits back
pharmafile | May 25, 2016 | News story | Manufacturing and Production, Medical Communications, Research and Development, Sales and Marketing | Medivation, Sanofi, removal of board, takeover
Sanofi (NYSE: SNY) has taken their proposed takeover of Medivation (NASDAQ: MDVN) up several notches, with the French company filing preliminary consent solicitation materials with the US Securities and Exchange Commission seeking to remove and replace each member of Medivation’s board of directors.
Sanofi has proposed eight individuals who would take the place of the current Medivation board, who they say “are willing to fully and fairly evaluate all of Medivation’s strategic options, including Sanofi’s acquisition offer.”
These proposed new board members include Michael E. Campbell, former CEO of Arch Chemicals; Barbara Deptula, former executive VP of business development at Shire; and Charles P. Slacik, former CFO of Beckman Coulter. Sanofi indicates that these proposed board members will act in the best interest of Medivation shareholders
CEO Olivier Brandicourt has also written a letter to the board at Medivation, again requesting their engagement on a potential sale. He writes: “We believe that we are in a position to provide more value than any other party given the strategic importance of the transaction to us.”
Medivation rejected an unsolicited $9.8 billion bid from Sanofi at the end of April. Since then, Sanofi has taken additional steps to try and push through a sale.
Brandicourt also addresses the reports of alleged interest from other big pharma companies, such as Pfizer, in acquiring Medivation in his letter. Again, he has strong words in this regard for the board.
He writes: “There have been published reports that you have signed confidentiality agreements with other parties. If that is accurate, we cannot see how you have not done so with us. If you have not signed confidentiality agreements with others as part of a sale process, then you are not doing what we are confident your shareholders want, which is for Medivation to undertake a sale of Medivation and to engage with Sanofi.”
For Sanofi to be successful in its bid to oust the Medivation board, written consents would need to be properly completed by the holders of a majority of Medivation shares outstanding as of the close of business on the record date.
UPDATE: 9.25am 26/5/16
The board at Medivation has responded to Sanofi’s latest attempt with another firm statement, where they indicate that they will promptly file consent revocation materials with the US Securities and Exchange Commission. They reiterate that that the offer of $52.50 per share “substantially undervalues” the company and indicates its decision is based on a thorough analysis of the commercial momentum and outlook for Xtandi.
David Hung, CEO at Medivation, says: “Medivation’s experienced board of directors has been instrumental in overseeing a strategy that has created a leading oncology franchise, delivered consistently strong financial performance, and positioned the company for future growth through its innovative late-stage pipeline.
“In contrast, Sanofi has not duty to act in the best interests of Medivation or its stockholders. Its proposal to replace our existing directors with its own hand-picked nominees is simply a tactical manoeuvre to facilitate a transaction that will transfer value that rightly belongs to Medivation stockholders to Sanofi.”
Kim Blickenstaff, chairman of the board, adds: “Sanofi is seeking to take control of our board in a clear attempt to circumvent objective deliberations over what course of action is in the best interests of all Medivation stakeholders. The unattractive economics of Sanofi’s proposal have not changed.”
Sean Murray
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