This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Celgene Not Buying Human Genome Sciences

SUMMIT, N.J. ( TheStreet) -- Celgene (CELG - Get Report) is not buying Human Genome Sciences (HGSI), according to a source in contact with Celgene management.

Late Friday, Reuters, citing its own unnamed source, reported that Celgene was one of two possible bidders for Human Genome Sciences, which is trying to fight off a hostile, $13-per-share offer from GlaxoSmithKline (GSK - Get Report).

Celgene has no interest in an acquisition of Human Genome or a merger of equals between the two companies, according to my source, contradicting the Reuters story. More likely, bankers working for Human Genome are planting speculative rumors in the press to compel Glaxo to raise its offer price, my source adds.

Human Genome has set a July 16 deadline for takeover offers from suitors other than Glaxo.

Investors would likely react with horror and anger if Celgene were to make a run at Human Genome.

"Crazy. Nuts. Horrid. Putrid," is how one analyst who covers Celgene described the potential of a takeover of Human Genome. The analyst asked not to be quoted by name.

A biotech hedge fund analyst asked to describe his reaction to a possible Celgene-Human Genome deal, was equally blunt: "Awful! Dumbest thing ever!"

Investors aren't necessarily dead-set against Celgene making acquisitions, but Human Genome would add little value to Celgene's core cancer drug business headlined by the multiple myeloma pill Revlimid. Human Genome and Glaxo sell the lupus drug Benlysta, but sales have been weak. The two companies are also partnered on a heart drug in late-stage clinical trials.

Celgene is developing a drug for autoimmune diseases so adding Benlysta might make sense if the drug's commercial performance can be improved. Having to share rights to Benlysta with Glaxo, however, would be a financial and operational hindrance.

Investors haven't been too happy with the returns from some of Celgene's most recent acquisitions, particularly the $2.9 billion paid to buy Abraxis BioScience and the smaller takeover of Gloucester Pharmaceuticals. Celgene is also struggling with U.S. and European regulatory delays to expand Revlimid in the first-line multiple myeloma treatment market.

"We don't think such a deal would make sense for Celgene and we highly doubt that Celgene will bid," said ISI Group analyst Mark Schoenebaum, referring to the rumors of a takeover of Human Genome in an email to clients. "To be clear, we would peg the odds of Celgene actually bidding at less than 10% at this point."

Shares of Human Genome closed Friday at $13.62. Celgene shares closed at $64.77.

-- Written by Adam Feuerstein in Boston.

>To contact the writer of this article, click here: Adam Feuerstein.

>To follow the writer on Twitter, go to

>To submit a news tip, send an email to:

Follow TheStreet on Twitter and become a fan on Facebook.
Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
CELG $109.45 -2.88%
GSK $40.51 -1.10%
AAPL $118.30 0.42%
FB $104.24 -1.15%
GOOG $742.60 -1.02%


Chart of I:DJI
DOW 17,719.92 -78.57 -0.44%
S&P 500 2,080.41 -9.70 -0.46%
NASDAQ 5,108.6660 -18.8590 -0.37%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs