Link to the article discussing above:
Well that explains the stock price.
Wunderbar!! I was hoping it would be BMS but oh well. We knew it had to happen one of these days. Hopefully, we can start moving ahead real fast now in developing the state of the art and reducing the incredible suffering that so many have been enduring all these years.
If you can't beat em join em!
from the Wall Street Journal
Gilead Sciences Inc. agreed to acquire Pharmasset Inc. for nearly $11 billion, placing a big bet on the growing market for new treatments for hepatitis C infections.
Gilead, which is known mainly for its blockbuster treatments for the AIDS virus, agreed to pay $137 per Pharmasset share, a nearly 89% premium to Pharmasset's closing price Friday and an impressive return for a stock that traded below $10 as recently as January 2010.
Pharmasset shares soared 85% at $134.17 in early trading Monday, while Gilead's shares dropped 11% at $35.67.
The pricey deal underscores the fierce competition among drug makers to advance new treatments for hepatitis C, a viral disease that damages the liver. People who received blood transfusions before screening of blood supplies began in the early 1990s are among those who may be at risk for the disease, making the aging Baby Boom generation a prime target.
Decision Resources recently predicted the market for hepatitis C drugs will soar to $16 billion in 2015 from $1.7 billion in 2010.
The treatment of hepatitis C has advanced this year with the introduction of new drugs from Vertex Pharmaceuticals Inc. and Merck & Co. But multiple drug companies are trying to develop new and potentially lucrative treatments that improve cure rates and are easier for patients to tolerate. Current regimens include injectable drugs that can be difficult to tolerate.
"A tremendous unmet medical need remains for patients and the medical community, and the field is rapidly evolving," Gilead Chief Executive John Martin said on a conference call with analysts.
Pharmasset, of Princeton, N.J., is developing a drug, currently named PSI-7977, which Gilead believes could become part of the first all-oral regimen for hepatitis C with potential U.S. regulatory approval in 2014. Pharmasset has other potential hepatitis C drugs in its pipeline.
Gilead, of Foster City, Calif., hopes it can have as much success in drugs for hepatitis C as it has had in treating human immunodeficiency virus, or HIV. Gilead was developing its own drug in the same category as PSI-7977, but Gilead executives said Monday it wasn't performing as well in testing.
Gilead said it plans to finance the transaction with cash on hand, bank debt and senior unsecured notes, and expects to close the deal in the first quarter 2012. Gilead expects the transaction to reduce its earnings through 2014, but to add to earnings in 2015 and beyond.
Gilead will launch a tender offer for Pharmasset shares. Gilead has received commitments from Bank of America Merrill Lynch and Barclays Capital in connection with financing of the transaction.
Barclays Capital and Bank of America Merrill Lynch are acting as financial advisers to Gilead in the transaction. Morgan Stanley & Co. LLC is acting as the financial adviser to Pharmasset. Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal counsel to Gilead and Sullivan & Cromwell LLP is serving as legal counsel to Pharmasset.
I was hoping that about BMS too. My doc told me one of the big guys would have the winning DAA combo and pieces of treatment with one or more companies would not happen. Guess they do that by buying up "small" ones.
Gilead is betting the farm on this one. Their drugs are apparently not that powerful. Wow that is a lot of money to pay for that company.
I wonder if this means they can/will pull their trials with BMS (upcoming trials) because Gilead has their own NS5A. They also have their own protease. Maybe they'll now toss that GS-9190 polymerase in the trash can! It's all going to be pretty interesting.