Abraxis BioScience Inc., the Los Angeles biotech controlled by billionaire Patrick Soon-Shiong, reportedly has hired financial advisers to help it weigh strategic options, which might include sale of the company.
Goldman Sachs and Lazard were hired by the company to explore options, sources familiar with the situation told Reuters Tuesday after dealReporter.com first reported the story.
An Abraxis BioScience spokesperson declined to comment on the reports. Reuters said Goldman also declined to comment and Lazard could not be reached for comment.
The reports follow significant movement at the company. Abraxis BioScience confirmed earlier this year that it intends to spin off a research and development arm called Abraxis Health, with Soon-Shiong as CEO. A timeframe for the spinoff, first made public last fall, have not been announced.
Abraxis BioScience CEO Lonnie Mulder left the company in January after less than a year on the job, leading to Wall Street speculation that there had been difficulties working out terms for the Abraxis Health spinoff. The company recently relocated its research and development operations for both entities from Marina del Rey to a larger Costa Mesa facility in Orange County.
Abraxis BioScience, which has a market cap of $2.1 billion, makes the breast cancer drug Abraxane. Its shares have risen over the past month after the company reported promising late-stage results for Abraxane in treating non-small cell lung cancer, a potential new market. Abraxane uses a proprietary nanotechnology called “nab” that increases the effectiveness of traditional chemotherapy drugs.
Soon-Shiong, who founded Abraxis’ predecessor companies in the 1990s, spun off its generic drug manufacturing arm, APP Pharmaceuticals, in 2007. The company was sold to German health care giant Fresenius SE for more than $4.6 billion a year later. Soon-Shiong's $3.7 billion share of the deal vaulted him to the top of the Business Journal’s Wealthiest Angelenos list in 2009, with an estimated net worth of $6 billion.
He retired as Abraxis’ chief executive in 2008, but remains executive chairman and its largest shareholder. Directly and through trusts, he and his family control roughly 60 percent of the company.
Shares closed down $1.47, or 2.8 percent, to $51.03 on the Nasdaq.
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