CAMBRIDGE, Mass.—Genzyme Corp. on Friday forecast 2011 profit well above Wall Street expectations, and said the outlook makes the biotechnology company worth $89 per share -- not the $69 per share offered by Sanofi-Aventis SA.
"Our board is unanimous in its view that the Sanofi-Aventis offer does not approach the real value of the company, nor does it reflect our financial recovery, the achievement of manufacturing and product-supply milestones, and the increasingly recognized commercial potential for alemtuzumab," said Chairman and CEO Henri A. Termeer, in a statement. Alemtuzumab, or Campath, is a leukemia treatment.
In July, Paris-based Sanofi-Aventis privately made a $69-per-share offer to buy Genzyme, then repeated it publicly in August. Genzyme's board twice rejected the $18.5 billion buyout offer as too low, and Sanofi-Aventis went hostile earlier in October. Genzyme's board has unanimously voted to recommend against the offer.
Sanofi-Aventis has said its offer represents a "significant premium" of 38 percent over Genzyme's share price before speculation over a possible deal surfaced in July.
Genzyme said Friday it expects to report 2011 profit between $4.30 and $4.60 per share on revenue of $5 billion to $5.1 billion. That compares analysts' average estimates for profit of $3.78 per share on revenue $5.08 billion, according to a Thomson Reuters poll. The company issued the outlook during an investor conference days after reporting a surge in third-quarter profit as it recovers from manufacturing woes with its key products.
Genzyme, based in Cambridge, Mass., is expecting to report fourth-quarter earnings between 90 cents and 95 cents per share, matching or exceeding analysts' 90-cent forecast.
Sales of its enzyme disorder drugs Cerezyme and Fabrazyme suffered over the last year as the company fixed manufacturing issues at its Boston-area facility. The production problems were prompted by viral contamination in the manufacturing process, which caused inventory shortfalls and a drop in sales. But, Cerezyme supplies are now back to full capacity after the company spent months shifting production and tending to the manufacturing problems.
Shares of Genzyme rose 59 cents to $72.55 in afternoon trading. Sanofi-Aventis shares slipped 17 cents to $34.57.
