Baxalta remains key target for M&A hungry Shire

By Dan Stanton

- Last updated on GMT

Photo - TimArbaev/iStock
Photo - TimArbaev/iStock
Shire’s CFO says a merger with Baxalta will offer significant operating and tax synergies as it continues to pursue the firm.

Shire’s $30.6bn takeover attempt back in August​ may have been rejected by Baxalta, but the firm continues to pursue its target, CFO Jeff Poulton confirmed at the Piper Jaffray Healthcare Brokers Conference yesterday.

He told investors the addition of Baxalta – the biopharma spin-out from Baxter​ – would be a significant step in helping Shire become the “leading global biotech, focused on rare diseases.”

The deal would double Shire’s revenues but, he continued (transcript here​), “we also think it offers potential for us to drive fairly significant operating synergies out of the business, as well as tax synergies.”

Poulton added: “There hasn’t been any impact on our ability to transact M&A, in spite of the fact that we’re pursuing Baxalta,”​ citing the $6bn acquisition of Dyax last month​.

Shire’s internal manufacturing operations are based in Massachusetts​ and includes a fully single-use facility in Lexington which makes its Gaucher disease drug VPRIV. Baxalta, meanwhile, owns and leases biomanufacturing sites at a number of locations, including plants in Austria, Italy, Singapore, Switzerland, the UK, California and Massachusetts.

Segmented Haemophilia space

The haemophilia space is a major business area​ for Baxalta, and Poulton was asked about the sustainability of the sector if Shire bought the firm.

“It’s a large market, $10bn market,”​ he said, “growing mid-single digit… driven by 40% of patients with haemophilia are diagnosed today and 30% are treated.”

He added Baxalta’s Advate has placed it in the leadership position and while “it’s not a market that’s subject to dramatic shifts and changes, it’s perhaps a market that will become more segmented.

“As new therapies are brought forward, the market may become segmented. But if you look at the way Baxalta’s pipeline is positioned, we think they’re well-positioned to take advantage of that segmentation.”

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