Human Genome Sciences to GlaxoSmithKline: No sale
Human Genome Sciences on Thursday reiterated its rejection of longtime partner GlaxoSmithKline’s takeover bid, saying it undervalues the Rockville biotech, and urged its stockholders to do likewise.
HGS cited its advisers, Credit Suisse and Goldman Sachs, which on Wednesday called the offer inadequate.
The company also announced a new one-year plan under which existing stockholders receive special share purchase rights. The “poison pill” plan kicks in when someone acquires 15 percent of the company’s shares, making HGS a less attractive target for a hostile takeover.
The plan, which the board could terminate before one year, “is intended to allow the Company to fully engage in its strategic review process and as a means to protect the long-term interests of the Company’s stockholders,” according to an HGS statement.
The British pharma giant last month made a private unsolicited offer of $13 a share, or about $2.6 billion, an 81 premium over the previous day’s price for HGS stock.
HGS spurned the offer, and its stock price doubled to about $14 a share, where it has stayed. It fell 2 cents to $14.23 Thursday.
Last week, GlaxoSmithKline — which works with HGS to develop and market the new lupus drug Benlysta, plus develop treatments for cardiovascular disease and diabetes that are still in clinical trials — went directly to HGS shareholders with the same offer. HGS urged its investors to sit tight, as it continued to review the company’s strategic alternatives, including a sale, possibly to GlaxoSmithKline.
For its part, the British drug-maker said it would not participate in the review process, saying no due diligence was needed, as the companies have worked together for years.
“We invited GSK to participate in this process, which is well underway,” H. Thomas Watkins, CEO of HGS, said in Thursday’s statement. “Instead, GSK chose to commence an unsolicited tender offer at a price that undervalues our Company. The HGS Board of Directors has determined that the GSK offer is not in the best interests of our stockholders and recommends that they not tender shares to GSK.”
GlaxoSmithKline, through its offer, “seeks to circumvent, disrupt and prematurely end [HGS’s] process to the disadvantage of HGS stockholders,” the Rockville company said.
Foreclosure rate dropped last month
Maryland’s home foreclosure filing rate in April fell 7.2 percent from March and 4.4 percent from April 2011, according to new data from RealtyTrac of Irvine, Calif.
With a rate of one filing per 1,659 households, Maryland had the nation’s 37th-highest rate. The U.S. average last month, one filing per 698 households, was down 5.1 percent from March and 13.9 percent from a year earlier.
Bank repossessions in Maryland fell year-over-year 47 percent last month. That was the fifth-biggest drop in the nation, tied with Virginia.
Prince George’s County again had the highest overall rate in Maryland in April, with one filing per 897 households. That was down 25.8 percent from the previous month and 26.7 percent from April 2011. Prince George’s was followed by Baltimore city, and Charles and Frederick counties.
Mass layoffs down in Q1 from 2011
The number of extended mass layoff events in Maryland plunged in the first quarter to four from 26 in the first quarter of 2011, according to new data from the federal Bureau of Labor Statistics.
Such events are defined as those that result in the filing of 50 or more initial claims for unemployment insurance benefits from an employer during a five-week period, with at least 50 workers separated for more than 30 days. The layoffs involve workers subject to recall and those who are terminated.
In Maryland, these events resulted in 391 initial claims, down from 2,829 a year earlier.
USEC deal extends operations at nuclear fuel plant
United States Enrichment Corp., the Bethesda company that provides uranium fuel to nuclear power plants, has signed a deal that helps it continue operating for one year the production plant in Paducah, Ky., that it leases from the Department of Energy.
USEC has operated the facility for almost 60 years. But the large amounts of electricity it uses make it less cost-competitive with other plants using newer technologies.
Under the new deal, the Department of Energy will provide about 9,000 metric tons of high-assay depleted uranium hexafluoride, known as tails, to Energy Northwest. USEC will re-enrich the tails into about 480 metric tons of low enriched uranium, a portion of which Energy Northwest will use at its 1,150-megawatt Columbia Generating Station in Washington, with the rest going to the Tennessee Valley Authority. The TVA will use the fuel in its reactors to produce tritium, which is used in nuclear bombs. TVA will supply the electricity for the re-enrichment at the Paducah plant under an extension of its contract with USEC — the TVA’s largest industrial electricity customer, according to a company statment.
"USEC is pleased to deliver on one of its stated objectives to extend Paducah operations on an economically sound basis," USEC CEO John Welch said in the statement. "This agreement represents a multipoint win for government and industry that allows taxpayers to realize value by converting depleted uranium tails into an asset. At the same time it provides material critical to our national defense that can only come from U.S. technology."
The deal “bridges the gap” between the aging plant’s production and the company’s new American Centrifuge plant in Piketon, Ohio, said John M.A. Donelson, USEC vice president of marketing, sales, and power. The company has struggled to obtain a $2 billion federal loan guarantee to finish construction of the Ohio plant. USEC reported a net loss of $540.7 million last year.
“This is a complex deal, and on behalf of the USEC employees whose jobs will be saved, I want to thank all the parties that came together to execute this business transaction that will serve our nation’s near-term national security needs,” Steven R. Penrod, USEC vice president of enrichment operations, said in the statement.
Washington County gets grants for development plan
The Department of Business and Economic Development awarded a $50,000 grant to help the Hagerstown-Washington County Industrial Foundation develop an economic development strategic plan. The plan, to be completed by November, will outline strategies for investments, attracting new businesses and creating jobs, according to a DBED statement.
The foundation also will receive $50,000 from the Appalachian Regional Commission for the project.
Canada OKs Osiris stem cell treatment
Osiris Therapeutics of Columbia reported Thursday that Health Canada has granted it approval to market its stem cell therapy Prochymal to treat acute graft-vs-host disease in children.
It’s the world's first regulatory approval of a manufactured stem cell product and the first therapy approved for the disease, a complication of bone marrow transplantation that kills up to 80 percent of children affected, many within weeks of diagnosis, according to Osiris.
“Much like the introduction of antibiotics in the late 1920s, with stem cells we have now officially taken the first step into this new paradigm of medicine,” Andrew Daly, clinical associate professor in the Department of Medicine and Oncology at the University of Calgary and principal investigator in the phase 3 clinical program for Prochymal, said in a statement.
"Today is not only a great day for Osiris, but for everyone involved in the responsible development of stem cell therapies," said C. Randal Mills, CEO of Osiris.
"Today Osiris turns the promise of stem cell research into reality, delivering on decades of medical and scientific research," said Peter Friedli, chairman and co-founder of Osiris.