Samsung Group In Talks to Buy Alzheimer’s Drugmaker Biogen

Biogen's stock increased on Wednesday following a report in a South Korean publication that Samsung Group was in talks to acquire the drug producer.

Biogen shares climbed 9.5% to end at $258.31, increasing the year-to-date gain to 5.6%.

The Korea Economic Daily reported that Biogen approached Samsung about purchasing its shares, which might be worth more than $42 billion.

This reflects a roughly 20% premium to Biogen's current market capitalization of approximately $35 billion.

According to Refinitiv data, the pharmaceutical company is worth $34.67 billion.

South Korea's biggest buyout on record
The transaction could be South Korea's largest offshore acquisition ever. The largest so far was in 2016, when Samsung Electronics paid $8 billion for auto electronics firm Harman International Industries.

Samsung announced in August that it intends to invest 240 trillion won ($206 billion) in robotics, microchips, AI, and biopharmaceuticals over the next three years.



Samsung, which merged its mobile and consumer electronics operations earlier this month, also plans to build a $17 billion chip facility in Taylor, Texas.

The development comes at an intriguing time for pharmaceutical and biotech businesses, which have enjoyed a prosperous 2021 following the introduction of effective COVID-19 vaccinations.

Despite an expert advisory panel's opinion that Biogen had not shown the medication's therapeutic benefits, Biogen's controversial Alzheimer's drug received U.S. regulatory approval in June, becoming the first new treatment for the memory-robbing illness in nearly two decades.

As its primary revenue generators, such as multiple sclerosis medication Tecfidera and muscular disease treatment Spinraza, face increased competition, Biogen has been counting on the drug Aduhelm to cushion a hit.

However, Aduhelm sales in the United States have been slower than projected, since hospitals have complained that the drug's expensive cost outweighs its benefits. This month, the business reduced its pricing by roughly half to $28,200.

2022 looks promising
The drug's sales in the third quarter were barely $300,000, a far cry from the $12.1 million forecast. In December, the business announced that the cost of the therapy would be slashed in half, to $27,200 per year for a patient of average weight.

Given the amount of capital some of these corporations have amassed, possibly in the neighborhood of $500 billion for acquisitions, the big picture for next year is very optimistic.

According to investment firm SVB Leerink, just three companies - Johnson & Johnson, Pfizer and Novartis - have received $150 billion.

Meanwhile, Biogen is actively developing more than 30 novel medications.