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Biotech / Medical : Celltech Group (NYSE: CLL) -- Ignore unavailable to you. Want to Upgrade?

To: keokalani'nui who wrote (55)	12/4/2002 11:19:22 AM
From: keokalani'nui	Read Replies (1) \| Respond to of 123

British Biotech Hires Celltech CEO As Chairman Wednesday December 4, 10:47 am ET By Susannah Rodgers, Of DOW JONES NEWSWIRES LONDON -(Dow Jones)- Shares of British Biotech PLC leapt more than 30% Wednesday on the appointment as non-executive chairman of Peter Fellner, the Celltech Group PLC chief with a track record in successful consolidation. British Biotech, mired by setbacks since its lead cancer drug failed in clinical trials in the mid-1990s, has been seeking a merger or acquisition for some time. The breakdown of merger talks with German biotech MorphoSys AG in October prompted the resignation of chief executive Elliot Goldstein. WestLB Panmure analyst Emma Palmer raised her rating on the stock to outperform on the appointment of Fellner, who joined British Biotech's board Wednesday and is to start as chairman once a successor is appointed to Celltech in early 2003. "British Biotech is very focused on M&A. With his consolidation experience at Celltech and strong pharma and biotech links, we expect Fellner to be able to facilitate this process," said Palmer. Given product disappointments and a depressed share price, consolidation is the right route for British Biotech, said analysts at ING Financial Markets. The bank added that the lack of a permanent CEO could remove one obstacle to successful dealmaking. Shares were up 1.3 pence, or 37%, at 4.8 pence at 1500 GMT. At their peak in the mid-1990s, the shares traded at just under GBP3. Since Goldstein's departure, Tim Edwards has taken the helm temporarily at the U.K. biotech, which despite being relatively product-poor, has cash for over two years' operations, or for a transaction, at just under GBP50 million. "As acting CEO, one of my tasks is to move this business on," Edwards told Dow Jones Newswires. "Carrying out M&A with the help of Peter Fellner is one of my tasks." Under Fellner's lead since 1990, Celltech became the U.K.'s first profitable biotechnology company, after merging first with Chiroscience in late 1999, then with Medeva in early 2000. The acquisitions enabled Celltech to amass a portfolio of products generating enough cash to cover research and development costs. Fellner's move to British Biotech comes at a time when many analysts say European biotech is ripe for merger as most companies are loss-making and some way from bringing drugs to market, while public markets aren't ripe for raising more cash. MorphoSys was seen as potential marriage material as the German biotech had promising products, but desperately needed an equity deal to bring in cash to keep operations running. At the time, British Biotech said it called off talks because the deal wouldn't add value for shareholders. MorphoSys declined to say who had called off the talks. But Joe Zammit-Lucia, President of Cambridge Pharma Consultancy, was less confident about the ability of cash-rich, product-poor biotechs to attract potential partners in the current market. "Merging is one approach to getting cash but it's not necessarily the best way or the cheapest," he said. "Biotechnology is at a down point. Whether rapid fast consolidation is going to be the way out of it I'm not sure. There are too many drivers stopping consolidation and not enough helping it." British Biotech also said Wednesday it reduced its pretax loss for the first half of the year to GBP8.1 million, compared with GBP8.4 million in the same period last year. -By Susannah Rodgers, Dow Jones Newswires; 44 20 7842 9269; susannah.rodgers@dowjones.com