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Endo Pharmaceuticals makes $2.2 billion offer for Auxilium

In a Philadelphia-area pharmaceutical takeover attempt, Endo International P.L.C. Tuesday offered to buy all of the shares of Auxilium Pharmaceuticals for $2.2 billion.

In a Philadelphia-area pharmaceutical takeover attempt, Endo International P.L.C. Tuesday offered to buy all of the shares of Auxilium Pharmaceuticals for $2.2 billion.

After the New York Stock Exchange closed, Endo said in a statement that it "delivered a proposal to acquire all of the outstanding shares of Auxilium," for $28.10 per share in a cash and stock transaction that Endo valued at $2.2 billion.

There was no immediate comment from Auxilium, whose stock closed Tuesday at $21.52.

Endo said the offer was a 40 percent premium to the average closing price of Auxilium shares for the previous 30 days.

Auxilium is headquartered in Chesterbrook and employed 639 people at the end of 2013. The company said last week it would lay off 30 percent of its workforce, or about 200 people, by the end of 2014. It cited declining sales of its testosterone-replacement drugs as a key factor.

Auxilium and Endo joined 10 other drug companies in filing a paper in support of testosterone-replacement medication in advance of a two-day FDA advisory committee meeting scheduled to start Wednesday in suburban Washington.

Endo was headquartered in Chadds Ford and then Malvern until late in 2013 when, through another acquisition, it was able to register in Dublin, Ireland. This was one of several health-care company moves, called inversions, designed to pay less in U.S. corporate taxes.

Auxilium is in the midst of its own acquisition, at least partially to reduce U.S. taxes. It has not yet completed the planned purchase of Canadian biotechnology company QLT Inc.

"Endo's proposal would provide Auxilium shareholders a substantial premium and immediate cash value for their investment in Auxilium, as well as the opportunity to participate in the upside potential of a leading global specialty health-care company," Endo chief executive officer Rajiv De Silva said in a statement. "In light of the highly complementary nature of our two companies' commercial portfolios, the growth potential of Auxilium's Xiaflex, and the significant synergy opportunities, we believe this compelling strategic combination would result in and create benefits for both Endo and Auxilium shareholders, as well as for patients, customers, and employees."

De Silva has been trying to quickly reorganize Endo through small acquisitions, by shedding money-losing operations, and trimming some jobs. De Silva would trim staffing if Endo acquires Auxilium.

Of the 639 people employed at Auxilium at the end of 2013, about 160 worked at its headquarters and about 130 at a factory in Horsham. Auxilium CEO Adrian Adams said in last week's statement that the cuts would eventually save $75 million in operating expenses, though Auxilium would have to pay about $20 million in severance in 2014.