Just one month after a Roche director tantalizingly suggested that a merger with Novartis may make sense “from an objective standpoint” and lead to a “pharmaceutical champion,” Roche ceo Severin Schwann has tossed the proverbial glass of cold water on the notion.
Why? The families that control 50 percent of Roche voting shares are not interested.
“Nothing has changed with regards to Roche’s position toward Novartis,” he told the media during a conference call to discuss earnings, according to Bloomberg News. “The familiar Hoffmann and Oeri have repeatedly stated they’re committed to Roche’s independence.”
More than a decade ago, you may recall, former Novartis chairman and ceo Dan Vasella, oversaw the acquisition of a 33 percent voting stake in Roche, which led to especially frosty relations between the two drugmakers, but left open the speculative possibility that a deal may one day get done.
Schwann, however, may have inadvertently fueled that speculation a few weeks ago when he subsequently said that “If the right opportunity (for a partnership) comes up, we would be extremely open to talk with Novartis as we would be with all the other players… If it makes sense for both companies, why not sit together and talk? It’s a very professional relationship with have Novartis” (back story).
Of course, any merger would likely cause a fuss in Switzerland, where the government is quite protective of jobs and cutbacks that Novartis attempted at various facilities led to protests and intervention by local politicians (see this).
Meanwhile, there was also chatter that, perhaps, Schwann and his board would consider paying a premium to buy the Novartis stake as a part of share repurchase program (see this). Of course, whether Novartis (NVS) would be willing to sell is another matter. But now that Vasella has retired, the new executive team is rethinking strategy and so, one never knows.
STORY ENDS HERE