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Roche Reported to Be Close to Deal in Genentech Acquisition

Written by on Tuesday, March 10th, 2009

Roche is reportedly close to reaching a deal over the Genentech acquisition.

The Wall Street Journal reported Monday night that the terms of the current deal under consideration would provide for a share price of $95 per share, which is 6% higher than Roche’s initial offer back in July.

Reuters is reporting that a source close to Roche says that the company would pay as high as $105 per share to close the deal, but that the source currently doubts that this will be necessary.

According to the San Jose Mercury News, sources close to the negotations are saying that this is basically a “done deal.”

So, we may finally be on the verge of losing a Bay Area icon.  Before the first Roche bid back in July, it seemed almost unfathomable to imagine the Bay Area biotech community without Genentech.  Now, it is all but a certainty that Genentech will be absorbed into Roche, and we in the biotech world little by little have grown to accept a community without Genentech.

In looking at this deal, it is impossible not to believe that the declining economy played an important role in the negotiations.  As the value of shares tumble, what shareholder wouldn’t seriously consider the possibility of cashing out?  In this case, shareholders knew they had an eager buyer waiting on the sidelines, so as the economy continued to deteriorate, the willingness to sell likely grew.

Furthermore, both Reuters and the San Jose Mercury News are reporting that Genentech at least seems to be growing weary of the shadow of uncertainty hanging over the company.  There is only so long that you can keep a company in limbo and prevent it from disintegrating.  I expect that Genentech is starting to recognize the impact that Roche’s ongoing acquisition efforts are having over the company generally, and that perhaps some key people over at Genentech are starting feel that it is time to move forward with what is increasingly perceived as the inevitable.

So, the California Biotech Law Blog anticipates that an announcement of a done deal is forthcoming.  We will keep you posted as the developments arise.

Category: Biotech Deals  |  Comments Off on Roche Reported to Be Close to Deal in Genentech Acquisition

Patent Reform Bill Passed in House

Written by on Sunday, September 9th, 2007

The House passed its Patent Reform Bill on Friday with a 220-175 vote, reported the San Jose Mercury News.

According to the Mercury News, the passage of the Bill was in part due to a push by Democratic leaders, including Speaker Nancy Pelosi.  Sixty Republicans also supported the Bill, including Republicans in districts with large concentrations of high tech companies such as California, Virginia, and Texas.  The Senate plans to take up a similar bill this fall.

The passage of this Bill in the House is viewed as a victory for the high technology industry, but that victory comes at the expense of the biotech industry, which has not supported patent reform.

Ephraim Schwartz of InfoWorld reported on the differing views of the two industries last week:

One of the significant changes in the [Patent Reform] Act addresses the apportionment of damages clause. . . .

Because the high tech industry is built on thousands of small patents while the pharmaceutical industry typically would have one or two patents that covers years of research, pharmaceutical companies would like to see awards kept high to discourage patent infringement while high tech companies hope that by limiting damages it will also limit the huge number of so-called nuisance suits these large companies receive year in and year out.

Jim Greenwood, the President and CEO of the Biotechnology Industry Organzation (“BIO”), issued a press release on behalf of the organization expressing disappointment with the House vote.  The text of that press release stated as follows:

BIO appreciates the continued efforts by the House to improve the Patent Reform Act, but unfortunately cannot support the legislation passed today as it threatens continued biotechnological innovation.  We welcome improvements to the U.S. patent system, particularly those that increase patent quality, increase public participation, and provide additional resources to the Patent and Trademark Office (PTO).  However, the legislation that passed the House today and the legislation currently pending in the Senate do far more harm than good to our nation’s patent system.

While we are disappointed that the legislation passed the House, we were heartened that it did so narrowly and that there was strong bipartisan opposition to the bill.  This opposition demonstrates the serious concern of varied stakeholders — across many industries, research institutions and other interests — with the bill and the need for a more consensus-oriented approach to patent law reform.We look forward to working with the Senate to improve upon this legislation, particularly with respect to provisions relating to damages, inequitable conduct reform, post-grant review proceedings and PTO rulemaking authority.”

There is no word yet as to the official reactions to the House vote by our California biotech industry organizations, BIOCOM and Bay Bio, but their reactions are likely to be very similar to those of their national counterpart.

What will happen with patent reform when the Senate takes up its bill this fall?  We are likely heading for some heated debate.   The California Biotech Law Blog will keep you posted on the developments.

Category: Biotech Legislative Developments  |  Comments Off on Patent Reform Bill Passed in House

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