Is Lion Biotechnologies Inc. (NASDAQ: LBIO) Preparing For A Huge Buyout?


Lion Biotechnologies Inc. (NASDAQ: LBIO) recently hired a president and CEO who is said to have relationship with the top management team at AstraZeneca plc (ADR) (NYSE: AZN). The company also announced the completion of equity fundraiser that saw it net $100 million, which together in existing cash balance should be enough to finance operations through the coming years. But Lion’s recent moves have also left some wondering whether the company was preparing itself for an eventual sale.

The newly hired CEO, Maria Fardis, has been at companies that eventually got acquired. Most recently, Fardis was the COO of Acerta Pharma before the company was acquired by AstraZeneca in a $7 billion deal. Before she came to Acerta Pharma, Fardis was an executive at Pharmacyclics and if you can remember the company was acquired by AbbVie Inc. (NYSE: ABBV) for a whopping $21 billion. It is worth noting that ABBV’s blockbuster cancer drug called Imbruvica came through Pharmacyclics and Fardis helped in developing the drug.

Is Lion Biotechnologies Inc. (NASDAQ: LBIO) buyout candidate?

As such, Fardis’ impressive track record in drug development and acquisitions is the source of speculation that by having her lead Lion Biotechnologies Inc (NASDAQ: LBIO), the board could be looking to a buyout future. The other source of speculation that Lion could be a potential buyout candidate is the fact that the company is already in partnership arrangement with AstraZeneca’s division called MedImmune.

But these remain just speculation because the message Lion is sending out is that it wants to focus on the development of its various compounds with the hope of bringing them to market.

$200 million in cash

It is for the same reason that the company sought to raise $100 million though a private equity placement. With the latest equity fundraiser, Lion Biotechnologies Inc. (NASDAQ: LBIO) now has nearly $200 million in cash and the management hopes the funds will be adequate to bankroll operations over the coming years. Lion will need more cash in the coming years as it expands its pipeline and advance the development of various compounds in the pipeline toward commercialization approval.


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