Cytokinectics As An Amgen Takeover Target Would Make Perfect Sense
Amgen Inc. moved into Q2 2014 with $22.81 billion in cash and equivalents on its balance sheet.In the last year Amgen Inc. invested a reported $9.69 billion in company mergers and acquisitions.
Amgen is working with Cytokinetics on omecamtiv mecarbil, a drug for the treatment of heart failure, a chronic condition responsible for the hospitalization of more than 1 million people in the U.S. every year.
Omecamtiv mecarbil is currently in phase 2 trials seeking to demonstrate that the drug can boost heart muscle function and reduce hospital readmission.
Amgen initially signed on for an option to work with Cytokinetics on the drug in 2006 when it paid the company $75 million upfront. Amgen executed that option in 2009, handing over another $50 million and taking on responsibility for development and commercialization in exchange for global rights to omecamtiv.
Overall, Cytokinetics may receive up to $600 million in milestones from Amgen and double digit royalties.
With Cytokinetics' market cap currently in the $160M range it seems that it makes perfect sense for Amgen to make a bid for the company.
The corporate offices for the two companies make them neighbors already.