Upcoming Benlysta decision sparks HGS buyout talk, advisory panel

Human Genome Sciences' ($HGSI) lupus drug Benlysta has the potential to be the first lupus treatment approved in more than 50 years, as well as the first developed specifically for the autoimmune disease. Bloomberg's analysts believe that Benlysta, once approved, could be worth up to $2.1 billion per year by 2014. And those predictions have spurred talk of a buyout after the expected Dec. 9 decision. But the FDA has asked for an advisory panel to weigh the drug's benefits against its risks, including cancer, infection and higher suicide rates.

"The robustness and the clinical meaning of the efficacy findings warrant discussion," the FDA said. Given the efficacy of the drug, analysts still expect Benlysta to be approved. Benlysta is a joint venture between HGS and GlaxoSmithKline ($GSK).

Although GSK is considered the most likely buyer, Michael Yee, an analyst at RBC Capital Markets, also listed Amgen, Roche, Abbott Laboratories and Johnson & Johnson as potential interested candidates. While GSK CEO Andrew Witty has ruled out megamergers, the company has set its sights on possible deals ranging in the "few hundred millions" to "mid-single digit billions," which puts HGS' price tag squarely in their sights.

- read the Bloomberg coverage
- and here's Reuters' story

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