Memory Pharmaceuticals Corp. said Tuesday Swiss drug developer Roche will buy the biotech company for about $50 million, in a move to bulk up its development of potential Alzheimer's disease and schizophrenia treatments.
Memory is already a partner with Roche on a midstage drug candidate aimed at treating Alzheimer's disease and schizophrenia, along with an early-stage compound aimed at Alzheimer's disease.
"The innovative work carried out by the scientists at Memory Pharmaceuticals will be fully integrated into Roche's research and development portfolio with the aim of providing new hope for patients and caregivers affected by devastating diseases such as Alzheimer's," said William Burns, chief executive of Roche Pharmaceuticals, in a statement.
Under the deal, Roche will start a tender offer to buy Memory shares for 61 cents apiece in cash, more than three times the value of shares, which closed at 15 cents Monday. Directors, officers and shareholders holding about 29.5 percent of the company's outstanding stock have already agreed to tender their shares.
After the tender offer, Roche will acquire any remaining outstanding shares through a second step merger.
Roche already owns about 55.9 percent of South San Francisco, Calif.-based biotechnology company Genentech Inc., which makes the blockbuster cancer drug Avastin. The Swiss company's $89 per share, or $43.7 billion, buyout offer was rejected in August as too low. Most analysts expect Roche to eventually buy Genentech, but have said the company's mix of blockbuster treatments make it worth at least $100 per share.