Roche Acquires Ventana and Invests in Facilities

January 24, 2008
Pharmaceutical Technology Editors
ePT--the Electronic Newsletter of Pharmaceutical Technology

Roche and Ventana Medical Systems signed a definitive merger agreement, thus ending negotiations that began in June 2007.

Basel, Switzerland (Jan. 22)-Roche and Ventana Medical Systems (Tucson, AZ) signed a definitive merger agreement, thus ending negotiations that began in June 2007. Under the agreement, Roche will purchase Ventana for $89.50 per share in cash (approximately $3.4 billion total), and Ventana’s board of directors will recommend that the company’s shareholders tender their shares to Roche. Both companies’ boards approved the merger agreement.

Roche’s new offer represents a premium of 4.9% above Ventana’s closing price on January 18, 2008, and a 19.3% increase above Roche’s initial offer of June 27, 2007.

The purchase of Ventana, a leader in the tissue-based diagnostics market, will enable Roche to add to its diagnostic offerings and oncology therapies. Christopher Gleeson, Ventana’s president and CEO, will remain CEO of Ventana’s business after the transaction is completed. Gleeson also will become a member of the Roche Diagnostics Executive Committee. Ventana’s headquarters will remain in Tucson, and its employees will become part of the combined company.

In related news, Roche announced investments in several of its European facilities on January 18. The company will spend roughly CHF 280 million ($255 million) to expand biotechnology drug research and development activities at its Penzberg, Germany, facility. The funds will primarily aid the development and production of biopharmaceuticals for oncology applications.

Roche will also invest a total of CHF 150 million ($137 million) to expand syringe-filling capacities at its Mannheim, Germany, and Kaiseraugst, Switzerland, sites. The sites produce drugs such as “Mircera,” “Pegasys,” and “Actemra.”

Roche’s investment in pharmaceutical production equipment totaled around CHF 1 billion ($912 million) each in Germany and in Switzerland during the last five years. The investments created several hundred new jobs, according to a company press release.