Chiron Buying Matrix Pharmaceutical
Wall Street has been expecting Chiron to make an acquisition because the Emeryville, Calif.-based biopharmaceutical firm is in desperate need of strengthening its drug pipeline after the failure in November of its experimental sepsis drug. U.S. drug regulators have also delayed the approval of Chiron's NAT blood-testing system, which was supposed to happen by the end of 2001, according to the company.
Whether the purchase of Matrix helps Chiron's growth story remains unclear. Matrix is still recovering from a major setback in September when an FDA advisory panel voted against its experimental head and neck cancer treatment, IntraDose. Matrix continues to pursue the drug's approval in Europe.
But Chiron seems more interested in another early-stage cancer drug, tezacitabine, that Matrix is developing. Matrix just started Phase 2, or mid-stage, testing of the drug in patients with solid tumors. Once it acquires Matrix, Chiron says it will continue this testing program.Chiron says it expects to close the Matrix deal in the first quarter. The boards of both companies have approved the merger. The $61 million deal values Matrix at $2.30 a share, based on the 25.6 million Matrix shares outstanding. Matrix shares were falling nearly 16% in recent trading to $2.18. Chiron shares were lower as well, off 72 cents, or 1.6%, to $44.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV