Genentech And Roche Strengthen Relationship

Non-Roche stockholders in Genentech have approved a transaction with Roche Holding that extends for four years Roche's option to have Genentech redeem the outstanding common stock of the firm, and gives stockholders the right to sell their shares to Genentech at $60 per share for 30 business days following the close of the four-year extension if Roche has not exercised its option.

The transaction means that Roche can also increase its ownership of Genentech to 79.9% through purchases on the open market. Roche is granted an option for 10 years on rights at commercial terms for new Genentech products in markets outside the USA. The Swiss firm will also have exclusive rights and pay Genentech a 20% royalty on Canadian sales of Protropin (somatrem), Nutropin (somatropin), Activase (alteplase) and Pulmozyme (dornase alpha), as well as European sales of Pulmozyme.

"With the demonstrated support of our stockholders for this expanded relationship with Roche, Genentech now is better positioned than ever to achieve its goal of optimal growth," commented Arthur Levinson, president and chief executive at Genentech.