EMERYVILLE, Calif. (Bloomberg News Service) — Chiron Corp., one of the world's largest biotechnology companies, agreed to buy rival PathoGenesis Corp. for about $700 million in cash, to add therapies for infectious diseases.
Chiron, in which Switzerland's Novartis AG owns a 44 percent stake, said it will offer $38.50 in cash per share for PathoGenesis, 18 percent more than the antibiotic maker's Friday closing price of 32 3/4.
The takeover would add PathoGenesis's inhaled antibiotic TOBI for cystic fibrosis patients, with 1999 sales of $60 million, to Chiron's products. The company, based in Emeryville, Calif., needs new products after a series of setbacks this year, including the halt in development of an experimental arthritis drug that proved ineffective.
"Chiron is trying to reinvent itself," said Robin Campbell, an analyst at Bryan Garnier. He said the takeover is "one step in many" for the company.