Seagen Balks at $40 Billion Acquisition

Image: Seagen

​Market Valuation:  $25 Billion 
 
Ironbound Buy-Side Valuation:  $23 Billion
 
Ironbound Assessment:  Seattle based Seagen Inc, founded in 1997, is a leading American biotechnology company that develops and commercializes targeted cancer therapies.  Our buyout valuation fairly prices the company between $15 to $32 Billion, or approximately 10-to 20-times sales.  The lofty valuation is 90% Goodwill for the rights to develop and produce TUKYSA® - a lifesaving treatment for metastatic HER-2 positive breast cancers.  TUKYSA® promises a phenomenal growth opportunity; upon FDA approval in 2020 initial sales started at $120 million and skyrocketed the following year to $334 million.  Merck shareholders are extremely optimistic outbidding by 25 percent our highest estimated valuation range.  The $40 Billion acquisition would strategically entrench Merck further into the oncology space alongside their blockbuster Keytruda®.  Indeed, Merck has greater scale capabilities to commercialize the acquisition and achieve a profitable return on investment faster than Seagen could on their own.