ICI sale finally agreed
ICI have accepted a takeover offer of £8 billion from chemical conglomerate Akzo Nobel. This 670p per share agreement is Akzo's third approach for ICI in as many months, following an initial offer of 600p per share in June, and then 650p per share in July. On both occasions, ICI rejected the deal on the grounds that it failed to recognise ICI's full strategic value (see Chemistry World, August 2007, p17).
However, the British firm finally gave Akzo permission to peruse its books after it made the 670p offer in early August.
As Chemistry World went to press, the deal had been put to the shareholders of each company for approval. Analysts predicted no significant objections from ICI shareholders, who are set to receive a 22 per cent premium per share on the 549p closing price of ICI shares the day before Akzo's first approach was announced. However, certain Akzo shareholders have voiced concerns that the Dutch firm are overpaying for ICI.
Akzo had been able to offer more money, and reassure most shareholders, since it agreed that after the takeover it would sell ICI's US National Starch subsidiary - the adhesives and electronic materials section of the company - to German consumer chemicals supplier Henkel, for £2.7 billion.
ICI's strengths in decorative paints and coatings are the main attractions for Akzo, which is already the world's largest maker of industrial coatings. The Dutch company is cash-rich after selling its pharmaceuticals business, Organon, for 11 billion (£7.5 billion) to Schering-Plough in March.
Illegal export of nerve agent
UK chemicals supplier Avocado Research Chemicals has pleaded guilty of unlawfully exporting a controlled chemical substance to Egypt. Avocado exported 100g of 2-diisopropylaminoethyl chloride hydrochloride (DCH), a potential nerve gas precursor, and 10g of hafnium, needed for nuclear control rods. Egypt is a non-signatory of the Chemical Weapons Convention. The Department of Trade and Industry spotted the export, for which Avocado did not have the necessary licence, in its annual review of the company's exports. Avocado has been ordered to pay £600 in fines, and £100 in costs.
Roche drug recall
The EU has suspended Roche's license to sell HIV drug viracept, after contaminated batches of the antiretroviral agent were found. The drug was recalled in June after batches of the drug were found to contain raised levels of ethyl mesylate, a known carcinogen. Roche said it is currently in discussion with the European Medicine Authority (EMEA) to validate a new manufacturing process for the drug, and that it expects to recommence manufacture in September or October. However, the EMEA says the drug can only go back on sale once it has assessed new safety data.
FDA reviews drug safety
The US Food and Drug Administration is to review the safety of two AstraZeneca drugs which have been linked with increased heart attack risk. Two of the UK-based firm's stomach ulcer drugs - including AZ's top-selling drug Nexium, which has annual sales of $5 billion (£2.5 billion) - will be reviewed by the FDA after studies connected long-term use with greater risk of heart attack, heart failure, and heart-related sudden death. Although the regulator's preliminary conclusion, based on more recent data, was that there is no increased risk of heart problems, AZ's shares fell 3.5 per cent on the news, effectively wiping £1.3 billion of the value of the company.
Thai plant planned
US chemicals giant Dow and Belgian firm Solvay plan to build the world's largest hydrogen peroxide plant, in Thailand. The plant, scheduled to open in 2010, will produce over 330,000 tons of peroxide annually, which will be used to make propylene oxide, the precursor to polyurethane. This new, simpler route to propylene oxide was jointly developed by Dow and BASF. The US and German companies are currently jointly building such a plant in Belgium, and are also in discussion to build a second in Thailand.
Johnson & Johnson job cuts
US pharmaceuticals and healthcare firm Johnson & Johnson will cut 3-4 per cent of its workforce in a bid to reduce costs. The cuts, which could amount to 5000 jobs, will be mainly from its drug and Cordis coronary stent businesses. Certain company sites will also be consolidated, although the company is yet to announce which. J&J said it is targeting pre-tax saving of $1.3-1.6 billion, as it faces patent expirations on key products. Sales of blockbuster anemia drug Procrit, worth $3.2 billion in 2006, have fallen following safety concerns, as have sales of drug-eluting stents. The company plans to focus on its late-stage drug pipeline, and said it plans to file for approval of between 10 and 13 new drugs between now and 2010.
EU generic drugs surge predicted
The European Medicines Agency's Committee for Medicinal Products for Human use (CHMP) has recommended the approval of a schizophrenia treatment, making it the first generic drug to be assessed under Europe's centralised procedure. This scheme allows drug makers to have their products assessed by a single centralised process that covers all markets in the European Union. Although the scheme was introduced in 1996, generics manufacturers have had to wait for pharmaceutical company patents to expire before seeking approval for their own versions of the drug. The schizophrenia drug in question, Zalasta (olanzapine), is produced by Slovenian generics firm Krka. Zalasta is a version of Eli Lilly's Zyprexa. The EMEA expects an increasing number of applications from makers of generics, as patents for centrally approved products expire. The agency forecasts eight more generic applications for 2007.
Co-op to make its own drugs
British retailer The Co-operative Group is to manufacture its own generic prescription drugs - the first time a UK retailer will make its own medicines. The Co-op will manufacture the drugs in China, in conjunction with Tasly, one of China's largest drug firms. The retailer, which runs over 600 pharmacies in the UK, said it was looking to gain greater control over its supply chain. The Co-op will invest £20 million the plant, which should start production within a year. The deal also marks the first time a deal of this type has been struck with a Chinese company - India has traditionally dominated the generics manufacture market.
Sanofi drug withdrawn
The European Medicines Agency (EMEA) has withdrawn from sale French pharmaceutical firm Sanofi-Aventis's menopause drug veralipride. The drug is used to treat hot flushes, but has been associated with various side effects including depression, anxiety, and sleep disorders. The Committee for Medicinal Products for Human Use said the drug's benefits did not outweigh the risks. Veralipride, first sold in 1979, is still available on prescription in Belgium, France, Italy, Luxembourg and Portugal. It was withdrawn from sale in Spain in 2005.
US chemicals manufacturer Equistar has agreed to spend over $125 million to clean up air, water, and hazardous waste pollution at seven of its US plants. The company will also put into place pollution control measures to prevent further spills. The move follows a settlement between Equistar and the US Environmental Protection Agency (EPA), who had discovered extensive violations of environmental laws. The EPA said that the pollution controls Equistar will put in place are stricter than regulations currently require, and should reduce the likelihood of future violations at the company's plants.
Nicotine receptors targeted
British pharmaceutical company GlaxoSmithKline has agreed a strategic alliance with US biotech firm Targacept to develop drugs that target nicotine receptors.
The deal, initially worth $35 million, will give GSK access to Targacept's neuronal nicotinic receptor compounds, including a treatment for acute postoperative pain currently in Phase II clinical trails. Including pain relief, the two companies will collaborate in five therapeutic areas.
Depending on pipeline performance, Targacept could eventually receive $1.5 billion from GSK. Targacept shares rose 20 per cent on the news.