Roche makes hostile bid for diagnostic firm

Swiss drug maker Roche said Monday that it would launch a hostile tender offer to acquire Ventana Medical Systems Inc. for about $3 billion after its efforts to negotiate a friendly deal were rebuffed.

Acquiring Ventana, which specializes in tissue-based diagnostics, would give Roche, one of the world’s biggest diagnostic companies, access to technology that helps researchers and doctors better select the right drugs for individual patients.

That emerging concept, known as personalized medicine, could also reduce the costs and risks of developing drugs.

The offer of $75 a share in cash represents a 45% premium to Ventana’s closing stock price of $51.74 on Monday. Trading in shares of the Tucson-based company was halted for the announcement.

When extended trading resumed, Ventana’s shares jumped 52% to $78.75, indicating that investors think a richer proposal will emerge, analysts said.

“Certainly, 75 bucks a share is a good number, but whether or not it’s enough to consummate a deal, we’ll have to see,” said Leerink Swann analyst Bruce Cranna.

“There’s a lot of interest in diagnostic companies in general, and if you have an ability to offer companion tests with therapeutics it becomes a little more compelling,” Cranna said.

Roche said it had made several attempts to talk to Ventana about a deal, and it remains open to negotiating a friendly takeover.

Roche said the tender offer remained subject to Ventana pulling its “poison pill,” or shareholder-rights plan, which would make an unsolicited acquisition costly and difficult.

Ventana said its board would consider Roche’s offer but declined to comment further.

Roche already has a strong position in biotechnology with a majority stake in South San Francisco-based Genentech. Ventana would help Roche build on its diagnostics presence, an area in which it currently has in-vitro, molecular and clinical chemistry diagnostic products.