Predators circle Acambis after drug maker's shares slump

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Shareholders in Acambis, the biotechnology company that lost one-third of its value last week after missing out on a US government contract, expect the company to be taken over.

Large pharmaceutical groups Sanofi-Aventis and Baxter Healthcare are thought to be among those running the slide rule over the company as a whole or looking at individual products, say market sources.

"It wouldn't surprise me at all [if the company was sold]," said Andy Smith of SV Life Sciences, a shareholder. "I thought someone would have done it before now."

Rajesh Varma of Carmignac, a holder of 3.5 per cent of the company said: "People have got their ears up now. If they sell it, I'm not going to complain. I'd get some of my losses back. I'm down 50 per cent."

The loss-making biotech was dealt a heavy blow last week when the US government informed the company after a "technical review" that it was "no longer in the competitive range" for a smallpox vaccine contract worth up to £1bn. Analysts had expected the company at least to split the deal with rival vaccine maker Bavarian Nordic.

"My worry is that Acambis doesn't have good vaccine technology," said Mr Varma. "If that's the case, it's dead money or worse." Acambis shares dropped as much as 42 per cent on the day of the announcement.

Sanofi is thought to be keen to get its hands on Acambis's Japanese encephalitis (JE) vaccine, which has produced promising clinical data. The French pharma giant is understood to have held licensing talks for a rival JE vaccine produced by Intercell, but it lost out on that deal to Novartis.

Baxter is a partner of Acambis on its US vaccines business. Acambis's vulnerable position, its £49.8m cash pile and products in development and on the market, have added to takeover interest in the company.