Amgen to Acquire Tularik for $1.3 Billion
THOUSAND OAKS, Calif. & SOUTH SAN FRANCISCO, Calif--March 29, 2004--Amgen Inc. (Nasdaq:AMGN) and Tularik Inc.
(Nasdaq:TLRK)
- Adds Five Clinical Development Candidates to Amgen's Pipeline;
- Further Strengthens Amgen's Research Capabilities and
Accelerates Planned Expansion into a Major Biotechnology Hub;
- Amgen's 2004 Guidance to Remain Between $2.30 and $2.40
Adjusted Earnings Per Share;
- Tularik CEO to Join Amgen in Senior Role.
Amgen Inc. (Nasdaq:AMGN), the world's largest biotechnology
company, and Tularik Inc. (Nasdaq:TLRK), a pioneer in drug discovery
related to cell signaling and the control of gene expression, today
jointly announced that they have signed a definitive merger agreement
whereby Tularik will become a wholly-owned subsidiary of Amgen in a
stock-for-stock transaction. The acquisition will combine Amgen's
leadership in cellular and molecular biology and medicinal chemistry
with Tularik's innovation in gene regulation. It will also
dramatically accelerate Amgen's planned expansion into the San
Francisco Bay area, a major biotechnology hub.
Under the terms of the agreement, Amgen, in a tax-free
transaction, will exchange Tularik common stock for Amgen common stock
in a ratio that fixes Tularik's value at $25 per share based on the
average Amgen stock price during a set number of trading days prior to
the close of the transaction. The value of the transaction as of the
anticipated closing date is expected to be approximately $1.3 billion,
net of estimated cash to be acquired and net of Amgen's existing
ownership of Tularik of approximately 21 percent. In addition, there
will be a one-time charge related to in-process research and
development affecting GAAP earnings per share in the period during
which the deal closes.
The transaction is expected to close in the second half of 2004.
Financial guidance previously provided on December 15, 2003 by Amgen
for 2004 adjusted earnings per share will remain unchanged by this
transaction. Amgen expects that this transaction will represent an
incremental increase of approximately $100 million per year in Amgen's
investment in research and development for the next several years.
"Amgen is excited about combining with Tularik, a high-science
company that is focused on grievous illnesses and that shares our
culture," said Kevin Sharer, chairman and chief executive officer of
Amgen. "We are particularly pleased to have David Goeddel, a pioneer
in biotechnology, join Amgen in a senior role."
"Tularik's research engine is a rare asset and a great strategic
fit. Tularik has a strong team of scientists who share our desire to
develop important new therapeutics in inflammation, metabolic
diseases and oncology. Amgen and Tularik have complementary chemistry
expertise and compound libraries that together strengthen and broaden
our discovery capabilities," said Roger M. Perlmutter, M.D., Ph.D.,
executive vice president research and development of Amgen. "David
Goeddel has built a great organization that will be strengthened by
Amgen's significant additional resources including capabilities in
protein, antibody, and small molecule modalities, development
expertise and commercial power."
Upon the closing of the transaction, Dr. Goeddel will become Site
Head of Amgen San Francisco, overseeing its research projects on an
ongoing basis as well as assisting in the strategic direction of
Amgen's pipeline.
"Amgen has recognized the value of our employees and our ability
to consistently and successfully bring small molecules into the
clinic," said David V. Goeddel, Ph.D., founder and chief executive
officer of Tularik. "We built Tularik to improve patients' lives
through the creation of novel and superior medicines that regulate
gene expression. Amgen supports this mission, and the combination will
allow Tularik researchers to continue with the additional benefit of
access to Amgen's global research, development and commercialization
capabilities."
The terms of the previous collaboration provided for Amgen and
Tularik to jointly embark on multiple oncology-related drug discovery
and development programs over a five-year period. Under this
agreement, Amgen committed to pay Tularik up to $21 million per
program, $50 million in committed research funding over a five-year
period and royalties on net commercial sales of Amgen products
resulting from the collaboration. In aggregate, Amgen had committed to
pay $125 million in funding and potentially additional significant
success related payments.
As a result of this acquisition Amgen will add Tularik's five
novel clinical programs and approximately 300 Tularik research
scientists in therapeutic areas of interest. Tularik programs include
potential treatments for cancer (hepatocellular, gastric and
esophageal) as well as potential treatments for inflammatory diseases,
type 2 diabetes and obesity.
The boards of directors of Amgen and Tularik have approved the
transaction, which is subject to clearance under the Hart-Scott-Rodino
Anti-Trust-Improvement Act. This transaction is also subject to the
approval of the stockholders of Tularik and other customary closing
conditions.
About Tularik
Tularik is engaged in the discovery and development of a broad
range of novel and superior orally available medicines that act
through the regulation of gene expression. Tularik's scientific
platform is focused on three therapeutic areas: cancer, inflammation
and metabolic disease. Tularik currently has five drug candidates in
clinical trials. In the cancer area, Tularik is currently conducting a
pivotal study of T67 for the treatment of hepatocellular carcinoma and
Phase 2 trials with T607 for the treatment of gastric and esophageal
cancer. T487, for the treatment of inflammatory diseases, and T131,
for the treatment of type 2 diabetes, are in Phase 2 trials to
evaluate safety and pharmacokinetic parameters. T71 for the treatment
of obesity has recently commenced Phase 1 trials.
About Amgen
Amgen is a global biotechnology company that discovers, develops,
manufactures and markets important human therapeutics based on
advances in cellular and molecular biology.
Additional Information about the Merger and Where to Find It
In connection with Amgen's proposed acquisition of Tularik
("Acquisition"), Tularik intends to file a proxy statement and other
relevant materials and Amgen intends to file a registration
statement/prospectus and other relevant materials, with the Securities
and Exchange Commission (SEC). INVESTORS AND SECURITY HOLDERS OF AMGEN
AND TULARIK ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS AND THE
OTHER RELEVANT MATERIALS WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL
CONTAIN IMPORTANT INFORMATION ABOUT AMGEN, TULARIK AND THE
ACQUISITION. The proxy statement/prospectus and other relevant
materials (when they become available), and any other documents filed
by Amgen or Tularik with the SEC, may be obtained free of charge at
the SEC's Web site at www.sec.gov. In addition, investors and security
holders may obtain free copies of the documents filed with the SEC by
Amgen by directing a written request to: Amgen Inc., One Amgen Center
Drive, Thousand Oaks, CA 91320-1799, Attn: Investor Relations.
Investors and security holders may obtain free copies of the documents
filed with the SEC by Tularik by contacting Tularik Inc., Attn:
Investor Relations at 1120 Veterans Blvd., South San Francisco, CA
94080. Investors and security holders are urged to read the proxy
statement, prospectus and the other relevant materials when they
become available before making any voting or investment decision with
respect to the Acquisition.
Amgen, Tularik and their respective executive officers and
directors may be deemed to be participants in the solicitation of
proxies from the stockholders of Tularik in favor of the Acquisition.
Information about those executive officers and directors of Amgen and
their ownership of Amgen common stock is set forth in the Amgen Form
10-K for the year ended December 31, 2003, which was filed with the
SEC on March 11, 2004. Information about the executive officers and
directors of Tularik and their ownership of Tularik common stock is
set forth in the proxy statement for Tularik's 2004 Annual Meeting of
Stockholders, which was filed with the SEC on March 17, 2004.
Investors and security holders may obtain more detailed information
regarding the direct and indirect interests of Amgen, Tularik and
their respective executive officers and directors in the Acquisition
by reading the proxy statement/prospectus regarding the Acquisition
when it becomes available.
Forward-Looking Statements
This press release contains forward-looking statements within the
meaning of the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995, including statements about future
financial and operating results and Amgen's anticipated acquisition of
Tularik. These statements are based on management's current
expectations and beliefs and are subject to a number of risks,
uncertainties and assumptions that could cause actual results to
differ materially from those described in the forward-looking
statements. All statements other than statements of historical fact
are statements that could be deemed forward-looking statements. For
example, statements of expected synergies, dilution, financial
guidance, timing of closing, industry ranking, execution of
integration plans and management and organizational structure are all
forward-looking statements. Risks, uncertainties and assumptions
include the possibility that the development of certain products may
not develop as expected or proceed as planned; that the Acquisition
does not close or that the companies may be required to modify aspects
of the transaction to achieve regulatory approval; that prior to the
closing of the Acquisition, the businesses of the companies suffer due
to uncertainty; that the parties are unable to successfully execute
their integration strategies, or achieve planned synergies, as well as
other risks that are discussed below and others that can be found in
Amgen's and Tularik's Form 10-Ks for the year ended December 31, 2003,
and in Amgen's and Tularik's periodic reports on Form 10-Q and Form
8-K.
No forward-looking statement can be guaranteed and actual results
may differ materially from those we project. Amgen's results may be
affected by its ability to successfully market both new and existing
products domestically and internationally, sales growth of recently
launched products, difficulties or delays in manufacturing our
products, and regulatory developments (domestic or foreign) involving
current and future products and manufacturing facilities. In addition,
sales of Amgen products are affected by reimbursement policies imposed
by third party payors, including governments, private insurance plans
and managed care providers, and may be affected by domestic and
international trends toward managed care and healthcare cost
containment as well as possible U.S. legislation affecting
pharmaceutical pricing and reimbursement. Government regulations and
reimbursement policies may affect the development, usage and pricing
of our products. Furthermore, Amgen's research, testing, pricing,
marketing and other operations are subject to extensive regulation by
domestic and foreign government regulatory authorities. Amgen, or
others could identify side effects or manufacturing problems with
Amgen's products after they are on the market. In addition, Amgen
competes with other companies with respect to some of its marketed
products as well as for the discovery and development of new products.
Discovery or identification of new product candidates cannot be
guaranteed and movement from concept to product is uncertain;
consequently, there can be no guarantee that any particular product
candidate will be successful and become a commercial product. In
addition, while Amgen routinely obtain patents for its products and
technology, the protection offered by its patents and patent
applications may be challenged, invalidated or circumvented by its
competitors. Further, some raw materials, medical devices, and
component parts for Amgen's products are supplied by sole third party
suppliers.
Amgen and Tularik are providing this information as of the date of
this news release and neither Amgen nor Tularik undertakes any
obligation to update any forward-looking statements contained in this
document as a result of new information, future events or otherwise.
Amgen Inc.
Reconciliation of "Adjusted" Earnings Guidance to GAAP Earnings
Guidance for the Year Ended December 31, 2004
2004
----
"Adjusted" earnings per share guidance $2.30 - $2.40
--------------
Known adjustments to arrive at GAAP earnings:
Amortization of acquired intangible assets(1) (0.16)
Merger related retention expenses(2) (0.01)
Write off of Tularik acquired in-process R&D
and other merger-related expenses - (3)
GAAP earnings per share guidance $2.13 - $2.23
--------------
(1) To exclude the ongoing, non-cash amortization of acquired
intangible assets, primarily ENBREL(R), related to the Immunex
acquisition. The total annual non-cash charge is currently
estimated to be approximately $340 million, pre- tax.
(2) To exclude the incremental compensation payable to certain Immunex
employees principally under the Immunex short-term retention plan.
The total estimated remaining costs of such retention benefits is
approximately $25 million pre-tax, and will be incurred through
the quarter ending June 30, 2004.
(3) In connection with the acquisition of Tularik, Amgen will incur a
one-time expense associated with writing off the acquired
in-process research and development . In addition, Amgen will
incur other merger-related expenses. As the final amount of such
expenses has not yet been determined, no adjustment is reflected
above.
EDITOR'S NOTE: An electronic version of this news release may be
accessed via Amgen's Web site at www.amgen.com and Tularik's Web site
www.tularik.com. Journalists and media representatives may sign up to
receive all Amgen news releases electronically at time of announcement
by filling out a short form in the Media section of the Web site.
CONTACT: Amgen, Thousand Oaks
Christine Cassiano, 805-447-4587 (media)
Cary Rosansky, 805-447-1060 (investors)
or
TULARIK, South San Francisco
Andrew Perlman, M.D., Ph.D., 650-825-7314
Alicia Williams, 650-825-7322
SOURCE: Amgen