US biotech giant Medivation has signed confidentiality agreements with several suitors, including Sanofi SA, paving the way for a potential a $10bn (£7.7bn) sale.
Speculation over the possibility of a takeover has followed the company for months.
Pharma giants Pfizer and Celgene have also signed confidentiality agreements allowing them to inspect Medivation’s nonpublic information which is typically the first step toward deal negotiations.
Sanofi has said it sweetened its initial low-ball offer, made back in March, to buy Medivation for $52.50 a share – or around $9.3bn – to $58 a share in cash and an extra $3 per share by 2022 depending on performance metrics.
A takeover of Medivation would allow Sanofi to ramp up its drugs portfolio.
Sales of its blockbuster Lantus insulin are in decline and it’s under pressure to launch new medicines.
Xtandi, Medivation’s blockbuster prostate cancer drug, is forecast to generate roughly $5.7bn in global revenues by 2020.
Medivation is also sitting on a pipeline for two drugs for the treatment of breast cancer and blood cancer.
Sanofi last month completed a €22.8bn (£19.5bn) asset swap with Boehringer Ingelheim, trading its animal health unit for a new consumer-health focused business as well as a €4.7bn cash payment.