Deadline passes in bidding war for drug maker

The next move in the bidding war between Millennium Pharmaceuticals Inc . and Genzyme Corp. was expected this morning , as a midnight deadline passed last night with no word from the two companies vying for Canadian drug developer AnorMed Inc.

Millennium, which currently has a friendly deal to buy AnorMed for $515 million, last night was operating under an 11:59 p.m. deadline to match or top Genzyme's recent higher offer of $580 million .

The decision could mark the resolution of a public bidding war that erupted in late August when Genzyme made a surprise $380 million hostile offer for AnorMed. Millennium soon jumped in, and since then the two Cambridge companies have steadily bid up the price for AnorMed.

The contest has been highly unusual in biotechnology, in which merger negotiations are conducted in private and rarely break out into the open.

For both Genzyme and Millennium, the prize is Mozobil , a drug being developed by AnorMed for treating blood cancers. Mozobil is designed to make bone-marrow transplants more successful, and possibly to increase the number of people eligible for such treatment, by helping their bodies generate healthy new cells.

The drug showed promising results in early clinical trials, and is currently being tested in 600 people with multiple myeloma and non-Hodgkin's lymphoma. AnorMed expects Mozobil to reach the market by 2008 at the earliest, and analysts have projected sales from $100 million to $300 million a year if Mozobil is approved by federal regulators. The figure could be higher if Mozobil turns out to be effective for other cancers.

For Millennium, with $630 million cash in the bank, buying AnorMed would represent a bold gamble: spending nearly all that amount to buy an unapproved drug that has not completed its largest clinical trial. If approved, Mozobil would be just the second product for Millennium. It would join the drug Velcade , a multiple myeloma treatment that Millennium also acquired by buying a company in 1999.

Genzyme already has a large stable of commercial products and could far more easily swallow the purchase, with $1.4 billion in cash currently on the books. It would add Mozobil to its transplant division.

Both Cambridge companies have been negotiating with Anormed for more than a year, and initially tried to license rights to sell Mozobil before making competing private offers to buy AnorMed outright. AnorMed is also developing drugs for other diseases, including HIV, but they are further from potential approval.

Stephen Heuser can be reached at sheuser@globe.com.