Biogen Idec to consider purchase offers

Biogen Idec Inc., the state's largest biotech company, is up for sale.

The Cambridge firm, worth more than $20 billion, said late yesterday it plans to consider outside offers, after receiving multiple "expressions of interest," including one from billionaire corporate raider Carl Icahn.

Icahn, who recently disclosed he owns a 1 percent stake in Biogen Idec, won antitrust approval in August to take an even bigger stake, raising speculation he could try to buy the company or force a sale. It's unclear how much stock Icahn currently owns. Icahn did not return a call seeking comment.

Biogen Idec said its financial standing is healthy and its prospects are good. But in a written statement, the company said it wanted to see whether "major pharmaceutical companies" might make an offer that is even more attractive than going it alone.

After Biogen Idec said it was for sale, shares soared 17 percent in after-hours trading to more than $81 each, up from $69.43 when the market closed yesterday. The stock, trading at close to its all-time high, has steadily climbed from roughly $60 in August, when the Federal Trade Commission granted Icahn's request to take a larger stake.

"A lot of people have been wondering whether it might be a takeover target," said Damien Conover, an analyst for Morningstar Inc., a Chicago investment research firm.

Biogen Idec has 4,000 employees, including 1,750 in Massachusetts.

Icahn, perhaps best known for taking over Trans World Airlines in the 1980s, frequently takes large stakes in companies and pushes for a sale or major changes to boost the stock price. And increasingly, he has set his sights on drug companies, including ImClone Systems Inc., the cancer drug developer linked to the Martha Stewart insider-trading scandal, and MedImmune Inc., one of the country's largest biotech companies.

In April, MedImmune agreed to sell itself to drug maker AstraZeneca PLC for $15.6 billion, shortly after Icahn threatened to start a shareholder fight to force a sale. The deal came just three months after Icahn first revealed he had taken a 1 percent stake in the Maryland company, the same percentage as his initial Biogen Idec purchase. Separately, Icahn took control of ImClone last year after a battle with management. He has also taken stakes in other biotechs, such as Adventrx Pharmaceuticals in San Diego.

This situation differs in that Biogen Idec almost immediately put itself up for sale after Icahn expressed interest in a purchase.

"Carl Icahn may have pushed them a little bit, but you kind of get the sense that management didn't need much pushing," Conover said.

Biogen Idec chief executive James C. Mullen stands to receive a golden parachute if he is fired or quits for a good reason after the company is sold. In a filing with the Securities and Exchange Commission, Biogen estimated Mullen's severance package was worth $20.2 million as of Dec. 31.

The news comes at a time when major drug companies are increasingly turning to biotech companies to help fill their pipelines with drugs, as patents on their old blockbusters expire and biotech companies churn out a growing number of promising experimental therapies.

Just this month, Bristol-Myers Squibb Co. snapped up Waltham-based Adnexus Therapeutics for $430 million in cash, plus another $75 million in conditional payments, as part of its strategy to develop more biologic drugs, which are made from living organisms, rather than a brew of chemicals.

And Pfizer Inc., another global drug company that has lagged behind some of its peers in biotech, said last week it plans to become a "top-tier company in biotherapeutics," raising speculation it could try to buy a major biotech company to jump-start its research program.

In addition to Pfizer, French drug maker Sanofi-Aventis SA has been mentioned as a likely suitor.

Biogen Idec said it retained investment bankers Goldman Sachs & Co. and Merrill Lynch & Co. as financial advisers on the possible sale, though the company cautioned it's possible it won't sell. A spokesman declined to say how much Icahn offered.

While Biogen Idec's stock stumbled badly two years ago when the company was forced to pull its multiple sclerosis drug Tysabri off the market after some patients using it in trials contracted a rare brain disease, shares have steadily risen since. The Food and Drug Administration allowed Tysabri back on the market last year and Biogen has since signed up more than 17,000 patients for the promising treatment.

The company also makes Avonex for multiple sclerosis and Rituxan for non-Hodgkin's lymphoma and rheumatoid arthritis.

In addition, it has laid the groundwork for a new crop of drugs in coming years to broaden its revenue. In July, Biogen Idec predicted revenue would increase this year 16 to 18 percent.

If the company were sold, it would likely mean the loss of one of the region's largest corporate headquarters, a blow to the state's prestige. But it might not translate into the loss of many jobs, since a drug company would likely want to use Biogen Idec as a key research engine to continue developing new drugs.

Biogen Idec was formed four years ago by the merger of two veteran biotech companies, Cambridge-based Biogen and Idec Pharmaceutics of San Diego. Biogen was originally founded in Switzerland in 1978.

Todd Wallack can be reached at twallack@globe.com.