Which pharmaceutical and biotech deal-making and financing developments of the past year are the most surprising, creative, or precedent-setting? According their industry colleagues, or at least those who voted at the IN VIVO Blog, the winners are Roche and Genentech in the Big Pharma category, Movetis' IPO in the Exits/Financings category, and Elan and Johnson & Johnson in the M&A/Alliance category.

For the second year, the editors of the IN VIVO Blog (an affiliate of "The Pink Sheet" DAILY), polled readers on the Deal of the Year, this time dividing the nominees into three categories. Voting closed Jan. 4; read below for the results and at the blog for more details and a recap of all the nominees who walked the red carpet.

And the blog editors offered this comment on the voting: "Let us point out one surprising (to us) thing: you clearly care more about M&A/Alliances than the Exits/Financing or Big Pharma categories. Because even though you didn't even have to leave the [online polling] page to vote on all three, the M&A/Alliances category racked up eight times more votes than the Big Pharma category, and more than five times the votes in the Exits/Financings category."

M&A/Alliance Deal Of The Year

Elan and Johnson & Johnson's July deal around Elan's Alzheimer's immunotherapy program was the big winner with 1,402 votes, or 39 percent of those cast in this category.

J&J purchased Elan's Alzheimer's program via a stock purchase plan that gives the health care giant an 18.4 percent stake in the biotech ('The Pink Sheet' DAILY, July 2, 2009). And the deal's complicated structure helps both J&J and Elan hedge against risk. In return for roughly $1 billion in capital (slightly less after Elan got into a tussle with Biogen Idec about a potential change of control to Tysabri ), J&J is creating a new company focused on Alzheimer's immunotherapy, with a near-term focus on the interesting, but still very risky, Phase III antibody bapineuzumab.

Elan benefits because it doesn't have to fork over all the upside to its Alzheimer's program, given the biotech retains a 49.9 percent stake in the newco and also has a 49.9 percent share in its profits or losses. Elan also gets significant help funding bapineuzumab's development with this deal. With J&J committing another $500 million to the antibody's Phase III trials, the molecule will have to rack up $1 billion in costs before Elan has to pay another penny.

Coming in second and not far behind Elan/J&J is the duo of GSK and Concert Pharmaceuticals (35 percent of votes). Third goes to Astellas and Medivation (22 percent) for their prostate cancer alliance. In this, a category where about 3,600 votes were cast, GlaxoSmithKline's acquisition of some of UCB's emerging market assets got only 15, good for a rounded-down 0 percent. Weren't emerging markets all the rage last year?

Rounding out the group, Abbott's acquisition of Solvay's pharmaceutical business got 2 percent of votes and Sanofi-Aventis's antibody discovery alliance with Regeneron got 1 percent.

Big Pharma Deal Of The Year

The winner, by a nose, is Roche's acquisition of Genentech, which garnered 27 percent of the vote, perhaps not a surprise given that Genentech might be a sentimental favorite for blog readers.

With its landmark agreement with Genentech already nearing a sunset, Roche made a preemptive strike, betting it would gain more by owning 100 percent of sales juggernauts such as Avastin and the ability to slash duplicative infrastructure than it stood to lose if the top talent at Genentech hung up their lab coats (Also see "Roche Wins Genentech After Months-Long Battle" - Pink Sheet, 26 March, 2009.). This tie-up isn't about innovation, it's about efficiency.

And the acquisition's final price tag, $95-a-share, while certainly a great deal more than the initial $89-a-share bid price, is more than matched by the likely earnings potential of Genentech's already marketed products. Furthermore, analysts estimate the biotech's mid- to late-stage pipeline more than adequately supplies Roche with a pipeline reservoir through 2016.

The second place deal, Pfizer and GSK's ViiV Healthcare joint venture, garnered 25 percent of the vote. But because this was the category with the fewest votes, only 11 votes separated the two. Third place goes to Pfizer and Wyeth.

Also rans were the Pharmaceutical Research and Manufacturers of America's pledged $80 billion contribution to health care reform (a.k.a. Dollars for Donuts) with 15 percent of votes, Merck's acquisition of Schering-Plough with 10 percent, and Pfizer's settlement with the Department of Justice on Bexxtra marketing, with 4 percent.

Exit/Financings Deal Of The Year

The landslide winner is Movetis' initial public offering, announced Nov. 20, with a 47 percent share of votes in this category. Bringing in €98 million in what is still a harsh climate for biotechs is quite impressive, even if Movetis isn't a build-it-from-scratch company and it has something relatively few other biotechs do: an approved product (Also see "Financings Of The Fortnight: Movetis Files First European Biopharma IPO Since Early 2008" - Pink Sheet, 20 November, 2009.).

And as of this writing, the company is trading above its €12.25 per share offer price. Movetis spun out of J&J at the end of 2006 with about €60.8 million in Series A venture funding led by Sofinnova and Life Science Partners. At the time, its lead asset, Resolor , newly approved in Europe for a subset of constipation patients, was already in Phase III. (In exchange for pipeline, J&J held on to 21.2 percent of the company and received an upfront fee.)

Coming in second in voting was Abbott's purchase of PanGenetic's NGF antibody (20 percent) and in a tie for third with 10 percent apiece were Vertex's milestone sale and Lundbeck's CVR-heavy acquisition of Ovation.

- Christopher Morrison (c.morrison@elsevier.com)

2009 Biopharma Deals Of The Year: Roche/Genentech, Movetis' IPO, Elan/J&J

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