Amgen's Acquisition Of Onyx Pharmaceuticals — Through The Eyes Of Tony Coles

By Rob Wright, Chief Editor, Life Science Leader
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In 2012 the FDA announced regulatory support for carfilzomib, one of Onyx Pharmaceuticals’ developmental blood cancer drugs. The news sent the company’s stock soaring, as well as rumors of it being a potential takeover target. After all, the company already had an approved product in Nexavar, and analysts were expecting its revenue to more than double by 2014, which was four times the median growth rate of a biopharma with a market value in excess of $1 billion. In 2013, Amgen closed its acquisition of the company for $9.7 billion. During a recent interview with Tony Coles, M.D., CEO of Yumanity Therapeutics and former CEO of Onyx for an upcoming feature in Life Science Leader magazine, he shared some of his insights from the experience. “We were in the process of expanding when we received an unsolicited offer,” he shares. “Though we were quite happy to continue to build a global enterprise, any CEO will tell you that you have a responsibility to be clear eyed and dispassionate when receiving and weighing such offers.”

According to Coles, sometimes such offers don’t go very far, and the decision is fairly easy, as what is being offered is below what a company is worth. Such was the case with Amgen’s initial offer for Onyx. “When we declined, Amgen asked if they could enter into discussions to better understand the company toward potentially improving its offer,” he states. The message Coles says he would leave readers with is as follows. “If you can answer the question — dispassionately — of what is in the best interest of the company for both the near and long term, then you’re on the right course.”

In some ways Coles found the decision sad, as the company was heading toward a strong growth trajectory. But in other ways, it turned out okay. “I’ve gotten notes, visits, and phone calls from former Onyx employees saying, ‘I was able to educate my kids. I was able to buy a home,’ they were able to do all the transformative things a lot of people hope they can do,” he shares. “If a merger can have a positive impact on patients and employees, then it tends to also be a win for shareholders as well.”