Biogen Idec Inc. is taking down the "for sale" sign.
The Cambridge biotechnology company yesterday said it has decided to remain independent, after failing to receive a single offer to buy the company. But it wasn't for lack of trying - over the past two months, Biogen Idec said, it had contacted every major drug company to see if any were interested in submitting a bid.
"We ran a comprehensive and thorough sale process," spokeswoman Naomi Aoki said. "In the end, we didn't receive any definitive offers to purchase the company."
The news is likely to relieve anxious employees, who were worried about what would happen in the event of a sale. Biogen Idec, founded on the cusp of the biotech revolution in 1978, has 4,300 workers, including 1,750 in Massachusetts.
But the decision to remain a stand-alone company will sorely disappoint some investors, who were betting Biogen Idec would fetch a rich premium.
The company's shares, which had soared to more than $84 on talk of a deal, plummeted $20.62 to $55.26, a decline of 27 percent, in after-hours trading yesterday.
"It's obviously pretty surprising," said William Tanner, an analyst with the Boston investment firm Leerink Swann & Co., who noted there was a flurry of rumors about interested bidders.
"There was speculation there was another round of bids due Friday," he said.
On Oct. 12, Biogen Idec said it would consider outside bids after receiving "several expressions of interest," including one from billionaire investor Carl Icahn.
Though the company cautioned at the time that it could still decide to remain independent, many analysts predicted a sale was likely.
Biogen Idec said it hired two respected investment banking firms, Goldman Sachs & Co. and Merrill Lynch & Co., to advise it on a possible deal. And Wall Street buzzed with speculation that some of the world's biggest drug companies, including Pfizer Inc. and Sanofi-Aventis, were interested.
Indeed, many pharmaceutical companies have said they are scouting for acquisitions to help boost their ability to produce so-called biologic drugs, which are made from living organisms rather than chemicals.
Many major drug makers are trying to find ways to replenish their pipelines of new medicines as patents on old blockbusters expire.
In April, AstraZeneca PLC wowed Wall Street by agreeing to buy MedImmune Inc., one of the country's biggest biotechs, for $15.6 billion after Icahn pushed the company to sell itself.
But the initial interest in Biogen Idec didn't translate into solid offers.
Sanofi-Aventis chief executive Garard Le Fur told Reuters last month that "the price is a little high, as you know."
At yesterday's closing stock price, Biogen Idec was worth more than $22 billion, and some analysts thought it would take an offer of $25 billion to $30 billion to complete a deal.
"This probably indicates that big pharma is smartening up and not going to pay the kind of premiums that it did in the past," said a Wachovia Securities analyst, George Farmer.
He said the AstraZeneca sale may have been a "one hit wonder."
Unlike many smaller biotechs, Biogen Idec has several drugs on the market and $3 billion in annual revenue. But some analysts caution that growth is limited for its two biggest drugs, Avonex, a multiple sclerosis treatment, and Rituxan, which treats non-Hodgkins lymphoma and rheumatoid arthritis.
The future is uncertain for Biogen Idec's other major drug, Tysabri - another MS treatment - as well as its pipeline of experimental drugs.
Biogen Idec recently predicted 100,000 patients will be taking Tysabri by 2010, up from 17,000 today, and hinted it could become a blockbuster drug in the long term, meaning annual sales of at least $1 billion. But some analysts believe the company is overly optimistic about the drug. It temporarily yanked Tysabri off the market two years ago after it was linked to a rare brain disease. Also, Tysabri is mainly used only after other treatments have failed.
"I think they have a lot to prove," said Eric Schmidt, an analyst for the investment bank Cowen & Co. who has a "neutral" rating on the stock.
Still, Biogen Idec insisted its future remains bright as an independent company. It recently predicted revenue will increase by 15 percent a year and that profits per share will jump by 20 percent a year through 2010.
"The board emphasized that Biogen Idec's business strategy is working and generating strong operating and financial performance," the company said in a statement yesterday.
Tanner said he thinks Wall Street overreacted, pushing the stock price too low after yesterday's news. But he acknowledged it depends on how optimistic investors are about the future of Tysabri sales.
Todd Wallack can be reached at twallack@globe.com.
