AnorMED rejects unsolicited Genzyme offer

By Elaine Rigoli

Tampa, Fla., Aug. 30 - AnorMED, Inc. said it unanimously rejected an unsolicited approach from Genzyme Corp. to purchase all of the issued and outstanding common shares of AnorMED for $8.55 per share in cash.

The company said it will negotiate with Genzyme by presenting a counter proposal that reflects its stand-alone prospects and the potential strategic value of the company.

Members of the AnorMED board noted that the Genzyme approach fails to recognize the company's ability to create value for shareholders by achieving clinical and commercialization milestones for its lead product Mozobil in stem-cell transplants and as a chemosensitizer, and its second clinical-stage product, AMD070 for the treatment of HIV.

Genzyme has been in discussions with AnorMED regarding Mozobil since October 2005, including an acquisition proposal in April at a proposed price of $8.55 per AnorMED share.

Genzyme said the company continues to face a number of challenges during this critical stage in the development of Mozobil particularly with respect to the following:

• The need to rebuild AnorMED's senior executive leadership and to recruit and retain experienced clinical and regulatory staff capable of completing the ongoing clinical trials, finalizing the associated clinical study reports and preparing what will be a complicated regulatory submission on an ambitious timeline;

• Execution risks associated with clinical development generally, and particularly with the development of a product such as Mozobil where its long-term commercial potential will depend significantly on unit pricing supported by convincing pharmacoeconomic data that demonstrate the value of the product to patients and to the overall health care system;

• The expense involved and the execution risks associated with building a commercialization infrastructure in both North America and Europe in advance of product approval; and

• The challenges of obtaining sufficient financial resources on a timely basis to fund the company's operating, developmental and infrastructure needs in a potentially difficult capital market and at the cost of significant dilution for current shareholders.

Genzyme said these challenges may ultimately prevent the shareholders of AnorMED from realizing the significant value potential that has been created by the company's early development work.

As more time passes, the potential value of the Mozobil opportunity, and therefore of AnorMED as a whole, may erode further, since there is a significant risk that the commercialization of Mozobil will be delayed, Genzyme noted.

AnorMED said it is committed to considering all proposals that provide shareholders with appropriate consideration for the likely increase in value from the achievement of its business milestones.

AnorMED is a chemistry-based biopharmaceutical company located in Vancouver, B.C.

Genzyme is a biopharmaceutical company based in Cambridge, Mass.

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