Vanda Pharma rejects unsolicited takeover bids

US biopharma company Vanda Pharmaceuticals (Nasdaq: VNDA) on Wednesday revealed that it has rejected takeover offers from UK-based Cycle Pharmaceutical and a revised bid from contract manufacturer Future Pak, arguing that both offers undervalue the company.

The unsolicited Cycle Group offer to acquire Vanda was for $8.00 per share in cash and the revised unsolicited proposal from Future Pak (FP) to acquire Vanda for $8.50-$9.00 per share in cash plus certain contingent value rights (CVRs) - worth up to $260 million - both substantially undervalue Vanda and are not in the best interests of the company and its shareholders. Accordingly, the Board has rejected the proposals.

The company explained that the Vanda Board again evaluated all aspects of Vanda's business against the unsolicited proposals and determined that the proposals are opportunistic attempts to purchase the company's shares at a discount to Vanda's intrinsic value. The Board's prior analysis of the company's clinical development pipeline, expanding commercial presence and significant cash balance remains unchanged. The Board also reached the same conclusion as it reached previously regarding the speculative nature of the CVRs given the uncertainty surrounding the achievement of the commercial milestones under FP's management.