Performing Amalgamations and acquisitions are like utilizing blades with two crisp borders. A proper usage of the tool would convey the combined company a better hereafter. However. being careless and sloppy in utilizing the tool could do us our ‘lives’ . A survey stated that over 60 % of all merged companies ended up with lower portion monetary values and values within their corporations compare to before the amalgamation. Uniting two or more different companies are non merely affairs of math and accounting computation. Fragile issues needed attending to guarantee that the amalgamation consequences value creative activity alternatively of value devastation.
Fiscal benefits are frequently overvalued and become lead oning for directors. in many instance of M & A ; A. A survey indicated that the largest jobs within M & A ; A are strategic a...
nd cultural issues. Employees and in-between degree directors tend to be left out in many amalgamation programs. doing diminishing morale and public presentation. A good M & A ; A project is the 1s affecting consideration of every facet of corporate being. Corporate market place. scheme. civilization and traditions. are of import facets needed to be considered.
Within this survey. I am discoursing the amalgamation of Biogen Inc. and IDEC Pharmaceuticals in June 2003 to from the 3rd largest biotech corporation in the universe. Biogen IDEC Inc. It was known to be the largest M & A ; A project in the Biotech industry since Amgen agreed to purchase Immunex for $ 10 billion in December 2001. The amplification would include treatment of prior-merger status of both companies. the principle of the amalgamation. how the amalgamation was performed and what the
amalgamation has resulted so far. II. Biogen Prior to Merger II. 1 History & A ; Background
The company. Biogen NV. was established when a group of the most complete life scientists in the universe gathers to discourse formation of a new pharmaceutical company. The meeting was held in 1978. in Geneva. Switzerland. Two old ages after the company was founded. one of Biogen’s laminitiss. Walter Gilbert Ph. D receives the Nobel Prize for one of his researches in sequencing bases ( ‘History’ . 2005 ) . In 1983. the company was registered as a NASDAQ traded house under the symbol BGEN. Biogen’s foremost originally developed merchandise enters the market in 1986. The merchandise was for intervention of hairy cell leukaemia.
In 1989. the company launches Engerix –B ( a vaccinum for Hepatitis B ) in the United States. One of Biogen’s hallmark merchandise. AVONEX was approved by the FDA and EMEA for gross revenues and selling in the United States and Europe in 1996. Another celebrated merchandise of Biogen. the AMEVIVE ( for intervention of terrible chronic plaque psoriasis ) and its specialised fabrication installation was approved by the FDA subsequently in 2003 ( ‘History’ . 2005 ) . II. 2 Products As a pharmaceutical company. most of the company’s operations are refering research and development of their medical merchandises.
Their prima merchandises are the AVONEX and AMEVIVE. AVONEX is designed to handle Multiple Sclerosis ( MS ) patients. It is the market leader and is being prescribed to handle over 100. 000 patients worldwide. However. that constitutes merely 35 % of people with MS. There is considerable room for growing for the merchandise. The drug has
besides been approved to be distributed in Europe’s market. Despite the entry of new competition into the US market. AVONEX remains the leader of prescribed intervention for MS worldwide. Its closest rival sells no more than half the size of AVONEX sale in 2002 ( ‘Biogen Annual Report’ . 2002 ) .
AMEVIVE on the other manus. is a merger protein whose mechanism of action is appropriate for handling a scope of autoimmune upsets. Research workers of the company believed that AMEVIVE supply drawn-out disease remittal with and improved safety profile proven by current therapies. Twenty-four per centums of patients treated with AMEVIVE cleared disease after a class of therapy. It has no critical side effects such as increased hazard of infection or malignance and systemic organ toxicity. One of the critical ‘features’ of the drug is the absence of ‘rebound effect’ .
In other words. diseases treated by AMEVIVE does non comes back to be more terrible. as frequently occurred with other signifier of interventions. Therefore. AMEVIVE can potentially supply long term betterment in life for patients. along with meaningful disease control ( ‘Biogen Annual Report’ . 2000 ) . Another developed merchandise of Biogen is the ANTEGREN. It is a humanized monoclonal antibody founded in the 1990’s by scientist at Elan Corporation. It is a drug for Multiple Sclerosis and Crohn’s disease. The company is working together with Elan Corporation to further develop the merchandise.
In the twelvemonth 2002. the merchandise is within its 3rd stage expecting for blessing for commercialisation. Besides the nucleus merchandises mentioned above. Biogen displayed important development in several other merchandises. They are: • ADENTRI for Congesive Heart failure ; in 2002.
the merchandise was on stage II of the development • LFA-1 for Psoriasis ; in 2002. the merchandise was besides on stage II of its development • Interferon Beta Gene Delivery for malignant neoplastic disease indicants. in 2002. the merchandise was at its first phase of development • Lymphotoxin Beta Receptor Inhibitor for Autoimmune Diseases. in 2002. the merchandise was at it first phase of development
• VLA-1mAb for Inflammation and Fibrosis • V: LA-4 Inhibitor for Inflammatory disease and LTBR mAB for Solid Tumors. both merchandises was in pre-clinical survey on 2002. ( ‘Biogen Annual Report’ . 2002 ) II. 3 Market Position The company is one of the greatest ‘curing cancer’ pharmaceutical companies in the universe. Its blockbuster merchandise. the AVONEX. resulted in mean $ 1 billion of sales/year since 2001. Its fledgling. the AMEVIVE is besides exposing important importance as drugs for handling world-wide patients enduring from autoimmune diseases.
The corporation owns superior biological merchandises that allow it to do wide programs for future productions. Its merchandise line is trusted by medical installations due to its satisfactory anterior public presentation presented by the AVONEX. Nevertheless. gross revenues of the drug seemed to miss growing in 2002. There are those who believe that the company will shortly hold to trust on new merchandises to present them grosss. The company has been stated to be the innovators in taking border research in immunology and neurobiology.
It is besides a pharmaceutical company with planetary gross revenues and selling capablenesss. The company has established biologics fabricating installations and able to keep strong fiscal place until 2002. II. 3. 1 Strategy The company plans to increase its gross by continue
puting in AVONEX. For illustration. in 2002. the company managed to do AVONEX the lone MS therapy eligible for Medicare reimbursement. The European Medicines Agency has besides approved AVONEX for usage in intervention of patients with high hazard of developing clinically definite Multiple Sclerosis.
While ANTEGREN is in its concluding stages of development. selling attempts for AMEVIVE Begins to expose consequence. In 2002. the company was optimist that AMEVIVE will make its modest mark of obtaining 5 % of the market. ensuing $ 500 million by the terminal of 2005 ( ‘Biogen Annual Report’ . 2002 ) . Beside Product development. direction of Biogen is sharpening the companys focal point by spliting research and development into several disease undertaking sections. Management realized that the following greatest challenge for the company is to alter from a individual merchandise to a multiple merchandise company.
The sections are: neurology with AVONEX and ANTEGREN ; dermatology. with AMEVIVE and LFA-1 ; and rheumatology with AMEVIVE. ANTEGREN and other grapevine merchandises ( ‘Biogen Annual Report’ . 2002 ) . These three countries were chosen and developed because Biogen believed to hold developed considerable competitory strengths in all of them. By farther focussing in those three countries. direction believes that they are increasing corporate competitory advantage. II. 3. 2 Technology The company owns assorted fabricating installation. most of so located in United States.
However. to back up management’s growing mark. in 2002. Biogen opened two new world-class installations in North Carolina. One of them is a $ 173 million big graduated table fabrication works ( LSM ) and the other is a150. 000 square pes research lab and office edifice. The LSM has 120.
000 litres of bioreactor capacity and was awarded by a California-based Fluor Corporation as the victor of the Project Excellence Award ( ‘Biogen Annual Report’ . 2002 ) . The high tech installation allows Biogen to bring forth multiple merchandises within their grapevine. It is a installation with one of the largest biologic fabrication capacity in the universe.
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