SUMMIT, N.J. & BOULDER, Colo.--(BUSINESS WIRE)--Nov. 18, 2007--Celgene Corporation (Nasdaq: CELG) and Pharmion Corporation (Nasdaq: PHRM) today jointly announced the signing of a definitive merger agreement pursuant to which Celgene has agreed to acquire Pharmion. Under the terms of the merger agreement, Celgene will acquire all of the outstanding shares of Pharmion common stock for $72.00 per share payable in a combination of cash and shares of Celgene common stock. The transaction is expected to be slightly dilutive to earnings in 2008 and accretive in 2009 and beyond.
The acquisition of Pharmion furthers Celgene's strategy to become a global leader in the hematology/oncology field. The transaction brings together three medically meaningful therapies, Revlimid(R), Thalomid(R) and Vidaza(R), treating different patient populations worldwide. These products are expected to generate multiple global revenue streams for accelerated revenue and earnings growth over the next five years.
"The acquisition of Pharmion is an exceptional strategic fit that will expand our role as a leader in hematology and oncology," said Sol J. Barer, PhD, Chairman and Chief Executive Officer of Celgene Corporation. "Our combined global infrastructure will leverage the therapeutic and commercial potential of Pharmion's products, particularly Vidaza, which has the potential to become a major global therapy. By bringing together the talents and resources of both companies, we move closer to our vision of becoming a leading hematology and oncology company in the world, expanding our industry leading programs for safety, access and patient support."
Pharmion is a global drug development company that has built a successful and promising oncology franchise. Pharmion has four products on the market and several in development focused on hematological and solid tumor cancers. Vidaza is approved in the U.S. for myelodysplastic syndromes (MDS). Vidaza has demonstrated unprecedented overall survival benefit for higher-risk MDS patients based on a Phase III trial. Pharmion previously reported that its Phase III study demonstrated that Vidaza extended overall survival by 74 percent as compared to conventional care regimens. Patients receiving Vidaza had a two-year survival rate of 50.8 percent versus 26.2 percent for those in the comparator arm. These results translated into a median survival benefit of 9.4 months (24.4 months versus 15.0 months). Pharmion expects to file a Market Authorization Application (MAA) in Europe for Vidaza in higher-risk MDS before the end of the year.
Additionally, thalidomide (licensed to Pharmion by Celgene to develop and commercialize in Europe and other select countries) is under review by the European Medicines Agency (EMEA) as a therapy in newly diagnosed multiple myeloma. An EMEA action is expected in late 2007 to early 2008. Pharmion's clinical development pipeline includes Amrubicin, a third generation synthetic anthracycline, which is in Phase III development for the treatment of small-cell lung cancer (SCLC) under an approved Special Protocol Assessment (SPA). MGCD0103, a selective histone deacetylase (HDAC) inhibitor is being evaluated in Phase II studies in hematological malignancies as well as in solid tumors.
"The combination of our two product portfolios and organizations represents the opportunity to create a leading global hematology/oncology company," said Patrick J. Mahaffy, President and Chief Executive Officer of Pharmion Corporation. "In particular, I would like to thank the Pharmion employees who have contributed so much to the development of our company and to ensuring that our products are available to improve the lives of cancer patients in the US, Europe, and many international markets. We believe that Celgene is now exceptionally well positioned to take advantage of these efforts, as well as those of its own strong organization, to create a truly unique global biopharmaceutical company."
Terms of the Transaction
The transaction has been unanimously approved by the Boards of Directors of both companies and is subject to customary closing conditions including the approval of the acquisition by stockholders of Pharmion and receipt of antitrust clearances. Celgene and Pharmion expect the transaction to close by the end of the second quarter of 2008. Under the terms of the merger agreement, each share of Pharmion common stock will be exchanged for $25.00 in cash and shares of Celgene common stock in an amount to be determined by an exchange ratio. If the volume weighted average price per share of Celgene common stock for the 15 consecutive trading days ending on (and including) the third trading day immediately prior to the closing date of the merger (the "VWAP Closing Price") is between $56.15 and $72.93, then the exchange ratio will be equal to $47.00 divided by the VWAP Closing Price. If the VWAP Closing Price is less than $56.15, Pharmion stockholders will receive 0.8370 Celgene shares for each share of Pharmion common stock, and if the VWAP Closing Price is greater than $72.93, Pharmion stockholders will receive 0.6445 Celgene shares for each share of Pharmion common stock. The cash portion of the transaction is being funded by Celgene's cash on hand. Upon the closing of the acquisition, Pharmion stockholders will own approximately six percent of Celgene's outstanding common stock.
JPMorgan and Merrill Lynch are acting as co-financial advisors to Celgene on the transaction. Banc of America Securities LLC is acting as the financial advisor to Pharmion Corporation. Legal counsel for Celgene is Proskauer Rose LLP and Arnold & Porter LLP, and Pharmion's legal counsel is Willkie Farr & Gallagher LLP.
Webcast
Celgene will host a conference call to discuss the strategic acquisition of Pharmion Corporation on Monday, November 19, 2007 at 9:00 a.m. ET. The conference call will be available by webcast at www.celgene.com. An audio replay of the call will be available from 12 noon ET November 19, 2007 until 12 midnight ET, Friday, November 23, 2007. To access the replay, dial 1-888-203-1112 and enter reservation number 8078427.
CONTACT: Celgene Corporation
David Gryska, 908-673-9059
Sr. Vice President and
Chief Financial Officer
or
Celgene Corporation
Brian P. Gill, 908-673-9530
Vice President,
Corporate Communications
or
Pharmion Corporation
Breanna Burkart/Anna Sussman, 720-564-9150
Directors, Investor Relations and Corporate Communication
SOURCE: Celgene Corporation and Pharmion Corporation
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