Shares of Brisbane, CA-based InterMune ($ITMN) surged more than five percent yesterday after Bloomberg treated the market to a story that Goldman Sachs had been brought in to scout buyout offers for the biotech. But the stock quickly calmed back down after the company put out a release stating that it had no plans for an M&A deal, adding that the developer is still plenty excited about its prospects for a newly-approved treatment for idiopathic pulmonary fibrosis.
InterMune shares had already been on a joy ride ahead of the market scuttlebutt, more than tripling since European experts endorsed the biotech's IPF drug Esbriet (pirfenidone) back in December. An approval followed in March. The regulatory green flag helped position the company on the only approved drug for IPF, a distinction that could earn blockbuster revenue on the continent alone. And analysts quickly tagged GlaxoSmithKline, Novartis and AstraZeneca as three likely players in any Goldman-led buyout.
InterMune "is not currently in discussions regarding a sale of the company," the biotech responded, adding that "management and the board are very enthusiastic about the company's business plans."
After a string of buyouts in the first quarter, investors are keeping a close ear to the ground for anything that sounds like a biotech acquisition, eager to step in ahead of any premium that could be offered for a company. The same overheated expectations set the stage for another report two weeks ago by Bloomberg quoting insiders as saying that Goldman had been brought in to field offers for Exelixis, a biotech which has enjoyed a big run-up in its stock after reporting positive results for the cancer drug cabozantinib.
InterMune took a big step forward in early March with its announcement that it won European approval for pirfenidone. The approval gives the developer a chance to start earning revenue on the orphan drug as it mounts a new late-stage study to satisfy doubtful regulators at the FDA, who rejected their marketing application.