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Amag Rebounds from FDA Handwringing, Looks To Stock Pipeline Through Acquisitions

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the broad market—women with heavy menstrual bleeding or post-pregnancy anemia, cancer patients, and so on,” Pereira says. The company believes the product could ultimately help 4 million patients in the United States alone.

Amag, which was originally called Advanced Magnetics, developed the science behind ferumoxytol two decades ago to help make contrasting agents for magnetic resonance imaging (MRI) procedures. “Unfortunately for us—but fortunately for science—the quality of imaging got so good that such contrasting agents were not as necessary,” Pereira says. In the early 2000s, the company started to look for ways to convert the technology into a therapeutic tool.

Pereira, who was on the company’s board, was named president in November 2005 and CEO a year later. His only management experience had come from serving as CEO of the physicians’ group at Tufts New England Medical Center, but he knew what Amag needed to do to position itself as a drug developer.

At the time, Amag’s corporate offices were inside its manufacturing facility near the Cambridge transfer station, or as Pereira puts it, “not a very hospitable part of town.” So the day he joined the company, he started to look for new office space. He interviewed potential job candidates at Starbuck’s, so they wouldn’t be put off by the company’s down-market headquarters. The company soon moved to a biotech park in Lexington, now home to a host of pharmaceutical firms, including Endo Pharmaceuticals, Cubist Pharmaceuticals, and a U.S. office of Shire.

“Aesthetics are important,” Pereira says. “Our stock went up threefold. It was easier to attract talent. It’s like everything else in life: success begets success.”

With its product now on the market and the safety saga a near memory, Amag is now shopping for other molecules to bolster its pipeline. To do so, it has adopted an increasingly popular strategy: It wants to acquire new drugs rather than develop them from scratch. “We think the interests of our company are best served by being a clinical-development and commercial organization rather than investing in research,” he says.

Pereira declines to specify what types of drugs Amag is looking to acquire or what its timeline for such a move might be, except to say “We are looking at candidates right now.” The basic idea, he says, is to bring in products that Amag could ultimately market with its existing salesforce, which calls on physicians in nephrology, hematology, and oncology.

Baird analyst Raymond said in his report that he suspects Amag itself may become an acquisition target. Zieziula responds by pointing out that like any publicly held company, Amag is beholden to its shareholders and would have to seriously consider any buyout offers. But that’s not management’s priority right now, Zieziula says. “We believe we’re well-equipped to optimize the value of [ferumoxytol] in the marketplace,” he says. “We work very diligently to do that.”

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