Bayer defines itself as upbeat, enthusiastic and visionary. itsill-fated monsanto crop research acquisition was pitched when it comes to feeding the whole world. the german chemicals and drugs team has become similarly enthusiastic about its transfer to gene treatment, which it views as having the disruptive potential for the internet.
Perhaps therefore. but there is little opportunity that having to pay as much as $4bn for us-based biotech asklepios biopharmaceutical would be transformational for bayer. the share price scarcely shifted monday.
To be sure, gene treatment the procedure or avoidance of disease by replacing faulty genetics with healthy versions is interesting. novartis, roche, pfizer and biogen have actually spent billions on similar deals. it can have a big effect on previously untreatable conditions.
But gene therapy is ballyhooed for decades and few remedies reach the market.the large, albeit one-off, prices associated with treatments are potential obstacles to their success.
Askbio has strong medical qualifications. co-founder richard jude samulski is a pioneer on the go. the present medical pipeline includes therapeutics for parkinsons condition and congestive heart failure. they're unusually ambitious, as more than one gene is involved. the risks included make them long shots.
A surer, if more mundane, prospect is askbios contract production company. there is a shortage of ultra-specialist production capacity and demand is expected to cultivate highly as treatments are authorized.
However that won't replace the looming lack of patent defenses for bayer bestsellers, like anti-clotting medicine xarelto. the division, which a year ago created simply over half bayers operating profit, needs to restock its pipeline. a share cost failure since the monsanto purchase guidelines out huge deals. with forecast web financial obligation of 2.3 times ebitda in 2010, bayer is limited to bolt-on acquisitions, partnerships and licensing discounts.
It is not likely askbios knowhow may benefit bayers crop science company. nor would it be expected to revive the pharma division adequately to pave the way in which for a spin-off. bayer will stay a stodgy conglomerate, priced correctly.
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