Though Potential Bidders Moved Away, Amgen's Bid For Five Prime Outlasted 15 Suitors

Earlier this month, biotech giant Amgen Inc AMGN announced a $1.9 billion buyout of Five Prime Therapeutics Inc FPRX that outlasted around 15 potential collaborators.

Background: Amgen’s interest in FPRX goes back to 2019 when it, alongside others (not named in the SEC filing), tried to bet on FPRX’s pipeline.

In November, Five Prime’s bemarituzumab data hit the primary endpoint goal, a moment the company had been waiting for quite some time.

The Phase 2 study enrolled 155 people with FGFR2b-positive tumors and randomized them to receive bemarituzumab or placebo on top of chemotherapy.

Progression-free survival in patients in the bemarituzumab arm on top of chemotherapy was 9.5 months, more than two months longer than in the control arm.

Bids To Collaborate: After the November data, FPRX initially was thinking about a bemarituzumab research deal (Bema Collaboration), which caught the attention of Amgen but also parties A through G. In all, Five Prime said the Bema collab program saw 15 “potential counterparties.”

Later, the company sat down and decided one of these Bema parties might want to buy the company outright. A collab, however, was still on the table, and parties A, B, C, and D were getting even more interested.

“In particular, on January 14 and 25, senior management of the Company met with executive management of Party C to discuss the Bema program and Party C’s capabilities as a potential collaboration partner,” Five Prime explains in the filing.

“On Jan 23, a senior representative of Party C, called William Ringo, Chairman of the Five Prime Board, to reiterate Party C’s interest in Bema and confirmed Party C was planning on submitting a Bema Collaboration proposal the following week.

On Jan 22, Party B’s representative emailed Dr. Mody to indicate that Party B’s intention was to submit a Bema Collaboration proposal.

On Jan 23, Dr. Mody spoke with a representative of Party D, who indicated that Party D was finalizing its proposal and would submit a request by Jan 29.

Besides, Party A also wanted in.

Party C, however, told the biotech it “was interested in a strategic acquisition of Five Prime rather than a Bema Collaboration.” It offered Five Prime $25 per share in cash. Then, Company D swooped in with an offer. (Though the financials of that were not revealed).

Final Bid: On Feb 1, it was made known that “Amgen was open to considering an acquisition of the Company.”

For the next few weeks, parties C and D and Amgen remained committed to a buyout deal, with others dropping out, preferring a Bema collab.

Party D later dropped out, leaving C and Amgen to battle it out at the end of February.

Party C was not sure, saying it would only pay in the late $20s to low $30s.

Then came Amgen’s $38 per share offer, which won the day.

Amgen’s Acquisition: Five Prime acquisition is Amgen’s biggest buyout after Onyx Pharmaceuticals in 2013 for $10.4 billion.

In recent years, it also bought arthritis med Otezla from Celgene/Bristol Myers Squibb for $13.4 billion and penned a BeiGene collab for $2.7 billion for a 20.5% stake in the company.

Price Action: FPRX shares are up 0.13% at $37.71, and AMGN is up 0.05% at $244.64 in market trading hours on the last check Friday.