The portfolio management team of Arctic Aurora LifeScience is currently in the USA visiting companies. Please read a commentary from Ulrica Bjerke with early impressions in a new year.
The pharmaceutical industry's most important annual conference, when the whole of the global pharmaceutical industry and investors meet in San Francisco, began with a takeover bid for the oncology company Ariad. The offer came from the Japanese company Takeda and had a bid premium of 75% up on Friday's closing price which prices the company to USD 5,2 Bn.
This is in line with Arctic Aurora LifeScience strategy - innovative biotechnology companies focused on cancer which may be takeover candidates. Ariad is not a part of AALS portfolio, but there are several similar oncology companies that also started the year with a sharp price rises on the conference first day of week. This includes for example Exelixis with a gain of 14,8% and Clovis with a daily increase of 10.5%. Both of these companies are obvious takeover candidates within the oncology space. The sharp rise in these companies stock price after Takeda’s bid on Ariad, signals that the market considers them to be the next takeover candidates - at very good premiums.
The Arctic Aurora LifeScience team sees M&A as a key driver for the sector in 2017. Big Pharma and Big Biotech companies need to extend their portfolios with new innovative products from smaller biotech companies. We also see that these innovative biotech companies can enter into good deals with larger companies. After the US Stock Market closed on Monday, one of the fund’s investments within the immune oncology space announced a deal with a total deal value of MUSD 250 plus royalties.