Merck & Co to buy Sibia for $87 million

Merck & Co has agreed to acquire Sibia Neurosciences Inc, the La Jolla,California-based drug producer which focuses on central nervous system disorders. Merck is offering $8.50 per Sibia share, giving the deal a value of $87 million.

Approximately 33% of Sibia shareholders have already agreed to tender their shares, and the deal is expected to be completed by September. Bennett Shapiro, executive vice president of worldwide licensing and external research at Merck, said that "Sibia researchers, who are among the best in the biotechnology industry, have opened several avenues for potential scientific discovery, and now we can further exploit them together."

The announcement provided a major boost to Sibia's stock, which shot up from $3.09 to $8.34, and is particularly good news after it released data from two Phase II trials of SIB-1598Y (altinicline) for Parkinson's disease which were not overly impressive (Marketletter August 2). However, the company is regarded highly in industry circles and has recently been issued with patents covering novel compounds for, among others, treating amyloid plaque deposition in Alzheimer's disease, according to Pharma Patent Bulletin. Its patent portfolio includes 48 issued in the USA with 58 pending, while abroad, 26 patents have been issued with 71 pending.