Icahn takes interest in, and piece of, MGI Pharma
The shareholder activist, who has invested in biotech firms in recent years, took a $17.8 million stake in the Bloomington business.
By Janet Moore, Star Tribune
Buried in a securities filing this week was the news that billionaire investor Carl Icahn has trained his eye on MGI Pharma Inc., a relatively tiny biopharmaceutical company based in Bloomington.
Icahn Capital Management bought a $17.8 million stake in MGI Pharma, which markets drugs for the cancer and acute-care markets. The stake is relatively small -- 606,518 shares, or 0.75 percent of the company's outstanding shares.
The 71-year-old shareholder activist -- who cut his teeth as a corporate raider in the 1980s -- buys stock in companies he believes are undervalued, often pressuring them to make changes in management, appoint him to their boards or to buy back stock.
Icahn's financial interests over the years have been vast, including TWA, RJR Nabisco and, more recently, Motorola and Blockbuster. But Icahn, born in Queens and educated at Princeton, is no stranger to biotechnology companies.
The same Nov. 13 Securities and Exchange Commission (SEC) filing indicates that he also bought a 1 percent stake in Cambridge, Mass.-based Genzyme Corp., one of the world's best-known biotech companies, with $3.2 billion in annual revenue.
Last spring, after Icahn bought a stake in the Maryland-based biotechnology firm MedImmune Inc., the company was sold to drug giant AstraZeneca PLC. The $15.6 billion deal prevented a potentially nasty proxy fight with Icahn, who threatened to nominate a slate of opposing directors unless the company put itself up for sale.
It's unclear what Icahn and his team have planned for MGI Pharma. A call to his New York office Friday seeking comment was not returned. MGI Pharma CEO Lonnie Moulder declined to comment this week about Icahn's SEC filing.
Several analysts who follow MGI Pharma also declined to comment about the Icahn news.
"It's really a very small stake, so it's hard to say what will happen," said Leerink Swann & Co. analyst Howard Liang, who rates the stock "outperform."
Moulder said he remains bullish about MGI Pharma's prospects -- noting that its signature drug, Aloxi, has rebounded nicely after being battered by a generic competitor made by pharma giant GlaxoSmithKline.
In addition, data regarding MGI's drug Dacogen, which treats several bone marrow diseases, will be released next month during the American Society of Hematology annual meeting.
One clinical trial involving Dacogen that will be released at the meeting was conducted by the M.D. Anderson Cancer Center in Houston, and tracked the survival rate of 115 patients.
MGI Pharma's stock declined 65 cents Friday, closing at $29.36, close to its 52-week high of $33.80. |
