ICEC

Ardea Agrees to AstraZeneca’s $32-Share Bid

AstraZeneca Plc (AZN) agreed to buy Ardea Biosciences Inc. (RDEA) for $1.26 billion to add experimental gout and cancer treatments as it looks to replenish its drug pipeline.

AstraZeneca will pay $32 a share for Ardea, the London- based company said in a statement today. That’s 54 percent above Ardea’s closing price on April 20. Excluding the cash on Ardea’s books, the purchase values the company at $1 billion.

The U.K.’s second-biggest drugmaker needs new products after it suffered setbacks in drug development while generic competitors challenge its top-selling products. With Ardea, it gains a drug called lesinurad, which is in the third — and most advanced — phase of clinical tests for patients who have too much urea in their blood, as well as an early experimental compound for the same ailment.

“A phase III drug is always a good buying argument for a pharma company even if gout is not one of the major indications,” Elmar Kraus, an analyst with DZ Bank AG in Frankfurt, said in a phone interview with Bloomberg.

Arde, based in San Diego, has two cancer treatments in mid- stage tests, for tumors of the liver and pancreas, which are being developed in combination with another drug with Bayer AG. “I think combination drugs are the future in cancer therapy,” Kraus said.

AstraZeneca fell 0.5 percent to 2,853 pence at 8:23 a.m. in London trading. The share has dropped 4 percent this year.

Chief Executive Officer David Brennan hasn’t announced an acquisition of more than $1 billion since buying MedImmune Inc. in 2007 for about $15.2 billion, and the company says it’s not looking for another deal of that size.

The planned takeover of Ardea “looks pretty sensible,” said Justin Smith, an analyst with Oriel Securities Ltd. in London. “It doesn’t look like they overpaid.”

Two of AstraZeneca’s biggest-selling drugs, Nexium for ulcers and antipsychotic medication Seroquel, lose patent protection by 2014. Nexium and Seroquel generated about $10.3 billion of sales last year and accounted for 30 percent of revenue. The drugmaker recently saw the failure or delay of experimental drugs for diabetes and ovarian cancer.

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