manus: so, sanofi outbid. medivation is off the table. where does that leave sanofi?s? what is next for sanofi? >> that is the question because that is a serious blow to sanofi . they really wanted to boost their presence in cancer and medivation represented a great target for them. so now, the ceo will have to find another. the problem is, there are not that many sizable revenue-generating cancer treatments out there. thank you very much indeed. a great list of corporate to be digging into. now, let's get into the autos. another crisis on the horizon potentially for volkswagen. it is not even on the horizon, it is now. the german carmaker is having to halt production on its most popular model, the volkswagen golf. for more, we are joined by chris ryder. he is just back from holiday. it is a relatively small supplier, but it is causing great damage already to volkswagen. talk to us about what is going down at the moment in germany. >> right now, they have shut down production of the golf and the passat line in germany. a number of plants are affected. it is unusual. v

were they just kind of wanting to get out of sanofi's target here?f: sanofi didn't play this aggressive early on and i think they upset people at medivation. that being said, it comes down to price. they would talk about how great pfizer is. but had medivation paid a dollar share -- more per italy's comes down to price -- it always comes down to price. i think companies felt very confident last week. i don't think the anticipated pfizer would go to this level. we will see if they topped the other bids. it seemed like a nice premium. oliver: the deal is going received -- but received approval. there is so much political dissatisfaction with that deal. the chinese company had to come to the hill to testify. has washington written more large now with companies? i think they get more comfortable, as long as chinese aren't buying a defense company or a tech firm that will allow them to sneak peeks into your e-mail or play with your credit cards. the reality is they have a lot of business in 25% of its revenue in the united states. they're a swiss company,

that hurt sanofi long-term. alix: what does sanofi have to buy?do not know that there is anything obvious. alix: smaller? >> smaller deals. something of this size, there are not a lot of these kinds of deals when you are of sanofi's sidze. most of the deals that should been done have been done. pfizer, back when they had money and status, valleant was spending a lot of money. now most of those opportunities are gone. if you are sanofi, ok, what else can we go after? what is there in europe or asia are in the united states? alix: of course, it is not just pfizer and medivation, it has been really hot for m&a. are there any regulatory hurdles to worry about? >> not thwith this one. the big issue is health insurance. the four big companies trying to come together. and regulators have been stricter the last 18 months. they have been cracking down on deals. but this deal does not seem like there will be any issues. alix: does not disappoint. the executive director of global deals. a second we'll get reading a u.s. second-quarter gdp wednesday. as revis

sanofi made an overture, and have astrazeneca, celgene and gilead, but it was pfizer's $14 billion that won out. sending shares up almost 20%. shares of pfizer fell slightly. meg tirrell tells us why medivation was so sought after. >> reporter: a $14 billion deal phaser beat our rivals to win in an all-cash deal that capped a month-long process. with it pfizer gained the prostate cancer drug this draws more than $2 billion in retch, proceeds that are split with the partner. and it gains two experimental drugs for cancer, building up a growing fo global spending on cancer medicines reached $107 billion last year, and is expected to top $150 billion by 2020. pfizer and other drug makers have made it a priority which has put biotech companies in the cross hairs for acquisition. investor whose e-squared asset management says that the drug jipt should do more deals to gain an even bigger presence in important areas, including immu investors rejoiced at the deal as well as the premium paid. it was 20% more than the closing share price friday, but almost $5 billion more than sanofi originally

so this morning, not such good news for synovial, a big blow for them -- sanofi, a big blow for them.e past five months, sanofi pressure medivation for a deal has just made medivation even hotter, even more of a target. you can see the share prices increasing drastically since april, and also increased the bidding pressure as well, so it was really good news for medivation, but sad news for europe's sanofi this morning. anna: medivation is clearly a hot property, with all these drug companies going after their assets. what makes them so hot? onearie: some call it a trick pony, but they are after a prostate drug. in terms of annual sales, last year it topped one billion u.s. dollars in annual sales, making it a blockbuster drug. by 2020, analysts say annual sales could come to $1.33 billion, and then it could hit the $2 billion mark by 2024. so this is the darling of medivation, what pfizer is after. but there are two other experimental drugs that pfizer will be acquiring, one for breast cancer and one also for blood cancer, lymphoma, which is really helpful to pfizer, which is trying

company thathis sanofi really wanted. >> that is the big question now.of speculation going around what the next target will be. honestly, there are not that many sizable targets especially within this particular area. it's going to be really hard for sanofi to find something similar to medivation. francine: no one can come back with a higher offer? very unlikely. all the feedback i'm getting. -- a deal that has been anonymously agreed by the two company so it is really hard. tom: are the american drug companies becoming more like the european drug companies? you guys figured out the script a decade even 15 years ago. the u.s. companies more like the european companies manuel:? that's a great question. i don't know whether it is going to be similar or not for what i know is that a target like medivation which was really coveted aggressively pursued by itofi and now they see foaming into the americans hands , that is pretty remarkable. move for the french company. they are really confusing for -- they're assets really competing for these price assets. tom:

bio moran and insight are two names that people expect a sanofi or gilead or who knows, pfizer, could make a run at. those are popular names especially the cancer spac for everyone is trying to build portfolio. matt: we are showing stock prices. 6.6%. is up already a market cap bigger than what we are seeing with medivation. arin: both insight and biom would be 20 to $30. scarlet: jeff mentioned sanofi and how it has left -- how it is left there wondering what to do next. where does that leave a company like sanofi in terms of how it can catch up with pfizer in terms of making these deals? drew: they are in a tough spot. it's obvious they started this process, brought everyone else in and lost. one of the issues they are having a problem is they have a lot of older drugs, especially in diabetes has been the backbone of the commercial side of the company for a while that are fading, approaching the end of their life lines in terms of being able to command high pricing and they have not yet figured out where they are going to turn next. we have heard them mention in a number of deals, t

sanofi has a vaccine where they surface proteins on the yellow fever core. one approach companies are using is putting the zika virus proteins on the core of yellow fever, or dengue fever. making a chimeric. another approach is a nucleic acid-based vaccine. the plasmid dna vaccine that dr. fauci mission. there is also a company that has started the clinical study of another plasma-based dna vaccine. and even newer approaches from nucleic acids called mrna. instead of using dna that you are starting with to make the immune response, they are using rna. it is a most the reverse mirror of dna. rna vaccines deliver rna, and that gets into the cell of the person, producing the protein that we are trying to elicit. other approaches include recombinant-based proteins. a number of companies are expressing proteins from insect cells and other substrates, using this production systems to express the virus protein and then using that as the vaccine approach. all these platforms in production systems or other life virus -- live virus approaches to deliver are in play ri

sanofi has a war chest. they're going to do something. david is not here but what he would tell you, listen, they were ready to buy. not going to sit there and say we don't need anyone. you'll see biomarine, i don't buy that, biomarine did a secondary. i like jjb very much. it has a good stable of orphan drugs. this is not an orphan drug company that sanofi was trying to buy. this company had a major cancer franchise that gets slotted in pfizer which means growth. >> yes. having already done several measures in the past year and a half. >> look, they wanted allergen. allergen was a very big deal. this is not nearly as big a deal. i think they paid a very full price for medivation. they don't care. a lot of these companies, other than j&j, are itching. j&j had $18 billion in cash and didn't do a deal last year, waig waited for the biotech to come down. i wonder when they start saying we have to take a look, j&j stock at 119, at 126 not long ago. the group is in play again which is great for -- you asked me about the market itself. biotech,

significant premium that sanofi offered. now pfizer won the bidding war which included not just sanofi, but gilead and maerk. so what does pfizer get for $14 billion. a suit of cancer drugs. approved drug is called standy and treats prostate cancer pfizer will also get two experimental cancer drugs. one in advanced clinical trials for breast cancer. the med vacation closed up almost 20% today. while pfizer was down slightly. some question the veracity plies of the deal. analysts said it made sense for pfizer which is increasing focus on cancer. expect the drug giant to do more similar deals. speculation helped the space broadly with the ibb. the etf that tracks buy tech up 2%. >> meanwhile shares fell in iowa after iowa senator officially requested the drug manufacturer to explain why the company has increased the price of epi pen. it will price has increased by nearly 400%. last week disgraced ceo told nbc news in a phone interview, these guys are really vultures. what drive this is company's moral compass? >> let's bring y

and the other answer i think is it was a competitive process in addition to we know that sanofi was at the table. it's been reported that celljean, gilead and merck were also interested. that could have driven the price up. pfizer may have been under pressure to get a deal done after trying to buy a couple and showing it's doubling down in the innovative products area and in cancer. >> sanofi could have in theory paid more based on their tax structure, right? pfizer is here in the united states. sanofi could have done an inversion, which meant they would have had financial synergies which they could have paid even more if they wanted to visa vee u.s. company, right? >> yeah, that's a good question. trying to accomplish with allergan deal invert does have a lower tax base. buying a u.s. asset using u.s. cash to do that, that's a great question. questions on the conference call of pfizer today said this isn't going to effect 2016 guidance, but what's it going to do to 2017 tax rate? they said they'd update us. >> seems medivation's board played it pretty well. >> they sure did. >> i woul

well, thought to be at least looking at med avation, sanofi looking at it, and merck looking. see those there. celgene up 1.5%. in terms of targets, jeffrey pout a note says sanofi may turn its attention to rare disease drugmaker biomarins, stock up 5.7 today. and incite, a midcap biotech and vertex working on cystic fibrosis, and companies are trading up today. maybe on speculation this is a hot class. other people want to buy in. >> what do we think, first are all, what this does for pfizer, and whether or not the buzz is true? in terms of the others? >> so pfizer really needs to add branded drugs, because they're still up in the air whether or not they're going to split the company from two and float faster growing on-brand drugs. maybe not big enough without adding this. pfizer says, five cents secretive next year. may be important strategically for that reason. what are your thoughts as far as the immunotherapy? still an area where there's a lot of promise? the one i bet on is bristol-myers, a big one, but then a lot of small ones. does that continue to stay in the focus

they have a 90% share in the epipen market, but some of that share actually was really due to sanofi'sned. and a lot of the other barriers with epipen are largely tied to the fact this is not just a drug but also a device. >> so, i'm sorry, have you done the back of the envelope analysis though? if they had to roll back the price increases we've seen across their portfolio, so for instance in the first six months of the year up 425% for the generic gallstone drug, up 444% for the generic gastroe soft jeel reflux drug, the list goes on and on. if you roll some of that back, what happens to earnings? >> the company's earnings around $5 a share right now. i'm basically at that figure. you know, it's hard to pinpoint what the earnings impact would be if you took all of the price increases that mylan's benefitted from and brought that back. but if you look at epipen specifically, epipen actually isn't the highest margin product at the company partly because they don't actually make the product. i actually think pfizer makes the product for mylan. so, you know, if you look at mylan from a st

. >> and i had thought if sanofi, reagainer in ron -- >> sanofi wants to buy medhivation, pfizer veryted in pursuing it. >> sanofi is the big buyer for regeneron, obviously, and regeneron has done a remarkable job. the stock was at $5 11 years ago. money is made in that group. this is a fascinating market because you really -- today is a fulcrum day. eight straight down would be big for the dow. the oil money, inventory comes out, the job growth was a little better than expected, the earnings were all over the map. i want to focus for a moment on dying equity. now that -- people know that is i hop and applebee's. applebee's was shocking to me. i have julius stewart on all the time. applebee's minus 4% com. i was looking for 1 to 2% minus. you have restaurants where you have the negative leverage. you've got wages up. >> yep. >> sales ticket down. >> all right. some chanting going on here. before we get to bob, fitbit, we mentioned up 9%. of course -- >> i like the quarter. >> off its all-time lows of 11.65, at 14.39. >> right. >> it had been as high as 52 bucks. >> well, i mean fitbit

sanofi is pursuing a tire, a transaction that has been shaken by the brexit fallout.fficials have threatened to clawback, clearing operations central to the acquisition. francine: thank you so much. in a world of cheap money, how can we be sure assets are priced correctly? take a look at stocks and bonds have performed so far. the s&p 500 more than 5%. bond yields have continued to fall as bond prices have risen. my guest is the portfolio biggestfor the world's managed fund, geraldine sundstrom from pimco. when you look at assets, it has been going not as smoothly as it used to. are we pricing things wrong? geraldine: that is the big question and a complicated one. i think we are in a world where most asset classes are pretty mature when it comes to valuation. manager, i have to look at them in absolute but also in relative terms. in absolute, pretty much everything looks on par relative to history. in relative, one thing we think stands out his credit. we do not think recession is on the very near horizon. portfolioing to focus around quality income and try to avoid

sanofi and reagain res said their drug met trials.atients with high cholesterol that don't respond to statins commonly prescribed for that condition. >> here tomorrow? you? >> i'm here. yeah, i'm here. i'm here. >> never know. >> andrew is vacationing. becky comes back this week maybe on wednesday. make sure you're hopefully joining us tomorrow. "squawk on the street" is next. ♪ >> good morning and welcome to "squawk on the street" i'm david faber with jim cramer. carl quintanilla is off. let's give you a look at futures. the market looking up so slightly. see it there european markets down, not a great deal of movement. london's stock market closed for a summer bank holiday. see italy taking it the worst. very glad we've included italy and spain. gone for a couple weeks. glad to see the

liz: that is sanofi, right? >> i've been in this 11 years, and seen twinject come and go.as recalled because of 26 unconfirmed reports. there needs to be investigation how the company has been able to maintain the monopoly it has. these are life saving devices but can come in a lot of healthy forms. healthy marketplace means healthy competition. liz: right about 3:00 p.m. eastern when we did the story, decided to lead the broadcast with it, that's today, and here, you can see it dipping right at around 3:00 p.m. eastern, and i'm not sitting here saying we took credit for it. when we had the father, he's a wall street guy, he understands profits, companies have a priet to profit when they have a mode of competitiveness around a great product. 15 million people need this thing, okay? two kids in every classroom in america, and so we get it, robin. if you had heather in front of you right now, the ceo, what would you say to her? >> i would say you've built your business model on the backs of american children, and it's time to take ownership for that, especially when a family

sanofi does have -- apparently everybody has a war chest.&j has a war chest. >> pfizer will buy anything. >> you know pfizer. >> they're like mikey with life cereal years ago. give it to mikey, he'll eat it. give it to pfizer they're buy it. >> i like the cereal business, red hot no it has been red hot. >> raised the prices. >> my life cereal. i enjoy that. >> i like that carl makes carl's wife makes this unbelievable granular stuff. >> really. >> never been party to that. you know, here we go. >> yeah. >> playing favorites on the anchor desk isn't he? >> i think i made no secret i like granola. >> you are a granola fan. >> back to -- yeah. so look, i want to own the banks, david. and i want to own -- >> the chips. >> the chips. >> every time on the banks it's been a mistake to own them. >> completely. >> totally wrong. >> it has. >> oh, get a rate hike, going to go to 50 basis points. >> you know -- >> would it be, could it be? 50? that will do a lot for them. >> i'm stuck in a world where jamie dimon came on the floor and said four rate hi

. >> and sanofi, who are potential buyers? >> i can't position think of on hasn't been named.lso hear names like astrazeneca continuing to work. bio gen is a potential target and buyer. so any of the big companies with cash are probably looking to buy right now. >> meg, thank you. pete najarian. >> meg and i talked about this day and i do look at bio agagen a possible acquisition. >> she shot that down. >> yeah, she sort of snickered at me. but that's okay. we always taul talk about tways pipelines. i look at what bio gen has in their pipeline and they have plenty of different drugs in in the later stages. but alzheimer's is something that everybody is focused on. and because of that, nobody has had the success that they're looking for yet. if they're in as we know that is the holy grail and if somebody is thinking the expectations for bio gen are good, this could be impressive. plus trades at a multiple that is very attractive. >> the move in pfizer wasn't so bad considering it was the acquirer. and big phrma, where would one go, they all have nice dividend yields also in sty

month according to people familiar with this matter other companies that expressed interest include sanofier, and gilead sciences. shares of medivation up more than 2%. scott. >> seema, thanks so much. that's not much of a move. i mean, for news like that, is it? maybe i'm missing something. >> i was involved. i sold mine 64 and change or so. the prior bid was 58 plus, you know, rights that would take it to 61 if everything clicked after the merger. so i figured, you know, premium almost 10% above -- actually 5% above it was enough, so i got out. but, look, there's a lot of interest. there's a bidding war here. question of how high they go and how big is cash. my guess is with merck it's cash. so maybe go up to 68 or so, i don't know. no idea. but, look, i'd say there's a little bit of downside and interest is real. >> okay. >> they were shopping it. >> give me something on lowe's. depot is in line, lowe's was kind of disappointing. josh. >> just not as good. i mean, that's been the story for a while. but that won't stay that way forever. these two companies have their ups and downs. i cou

you can't stress enough, if david were here, i think we would be talking about sanofi was outbid by pfizernd so there's a lot of money around. a lot of bankers had raised a lot of money to go after medivati medivation. who's next. or will gilead break up into a slow and fast. abbott has done a lot of acquisitions. a piece about medtronic. how they have everybody covered. you want to compete against medtronic you have to buy other companies. the action in health care is why this market is so -- >> we will talk to bill george later in the morning. >> the company he created but they -- he will be the first to tell you they made great acquisitions. medtronic is a powerhouse. i cannot believe how strong this company is. industry is filled with strong companies. edwards life science, abbott. >> somebody said it's a good time to be a mid-sized biotech company. >> it sure is. look, for it's been a year and a half it's been horrendous. just very good bargains where they're selling through the price of traditional pharma. >> when we come back we will get cramer's mad dash and count down to the openi

whether it's sanofi or pfizer or celgene. gilead and or merck. >> and merck. look at gilead.ne of the greatest single discoveries of all time but it's a cure. and you know cures, unfortunately, are not as good as continuals. >> yeah. >> but anyway, i bring lily to mind because once again, what i find is that when you have faith in big pharma, you better really have it nailed down. and i was shocked at opdivo, wasn't sure about -- i think lily is a little -- frankly, bau i like those guys, a little too promotional. >> noncell lung cancer. >> i went to a doctor who didn't tell me that was -- >> you heard the opening bell. here at the big board the autism society did the honors, nasdaq, communications network, there you go, celebrating their 40th anniversary. congrats on that. s&p real time exchange getting itself together, a mixed open at this point. p. >> we haven't talked seconda secondaries. >> we haven't talked about supply and haven't talked -- never really got to the equity offerings, follow on offerings not necessarily secondaries. >> let's look at two different ones. fi

but you do have i mentioned this the other day quickly but celgene, gilead, pfizer, merck, and sanofihowing expressions of interest. >> you know who is interesting not showing an expression of interesting -- >> it's not clear anything will get done prior to labor day but i'm going to be away like so many for a little bit, keep an eye on that one. >> i want to return to brent saunders and allergen. he's going the opposite. a lot of people thought he would be in there buying. >> very small stuff. >> $5 billion to buy back his stock at this level and then he will reload for another $5 billion if this stays and it's pipeline for him. developing a very good pipeline. he's the opposite of these other guys who might find pipeline chaegds. eli lilly should be in medvation their pipeline is getting challenged. >> maybe so. >> who should be looking. >> that's a lot of potential. >> some of these biotech stocks like biomer rin, using the strength to raise capital to do these very difficult drug trials, but yeah, medivation is on the block. notice who else is not buying and i salute them, whom i

sanofi had a problem with a little more than two dozen of its pens, of its devices. voluntary recall, there was pressure from the fda. there was a generic epipen application from teva, rejected. fda required another company in san diego to expand patient trials and reliability studies for another rival to the epipen. so time and again if these bureaucrats and politicians want to throw their hands up, show outrage, show outrage at government. i find it ironic, every time something this happens, government is part of the problem, not the solution. quit saying otherwise. >> the reason this has gene, failures of affordable care aff. deductibles are so high. sandra: what the ceo blamed on. >> consumers feel the cost now more than ever they are. fascinating how failure of that law, this is just the first case of some price-gouging you believe. dagen: if you believe price controls are the answer, which hillary clinton proposed, get ready for less, less in terms of drug development. get ready for the government to decide what you get and what you don't get in terms of your h

and the fda pulled sanofi's competing product called avi -- >> it has dispenser issues. >> two more facts in europe where i think the regulatory burden is far higher than anything we've ever seen in the united states, there are two competitors to the epipen. why aren't they here? >> there are two problems, first when you don't have only just one player in the game, the cadillac product, you risk shortages. especially when the fda shuts down production facilities. more importantly when the fda doesn't prioritize these types of applications and doesn't help the company succeed and teva is a great example world class company they know what they're doing, you're allowing the company to do the wrong thing. the interesting thing, heather bresh, president of mylan, she's the daughter of senator joe manchin. so hopefully labor day there's some discussion going on here about doing the right thing. >> but at the end of the day i don't think the fda's going to hold the bag on this. the company is and the company's executives and managers and leaders. they're the ones who will have to either fix this

the stock has rich a lot over the last few months as sanofi kicked off this battle that turned into arocess. over the weekend we learned pfizer winning this morning paying $14 billion in cash, winning prostrate drugs as well as two cancer drugs in the pipeline, one more other cancers more advanced. as joe pointed out amino oncology ahead of that in the pipeline. pfizer trying to increase its presence in cancer. it already has big breast cancer and big play in amino therapy harnessing immune system to fight cancer. one of the biggest ways to fight cancer that drugmakers are currently pursuing. they are saying $0.05 accretive in the first full year. some people are questioning the price this morning on medivation from the biotech side. wondering will this buoy biotech across the board big drugmakers me tiff process, many drugmakers in the deal paying quite a premium for this asset. >> by the way. we were talking earlier with a guest, still cheap to find financing, boosting m and a deals. >> this year coming back a little bit and people wondering is this sort of drive interest back into

and the competitors which came from sanofi, that was recalled, and teva was supposed to be working onut so far they're the only ones, so they can jack up the prices but not so fast. stuart: when liz broke this story, mylan was down 2%, now it's down 4%. >>> on his trip to latvia, vice president biden gave a message to baltic leaders. now, what's this all about? >> he did. firstly, and i'm reading directly here, i want to make it absolutely clear to the people many baltic states, we have pledged our sacred honor, the united states of areaty. now, this is in response to comments made by donald trump who said, wait a minute, you expect us to be a part of this, but you're not paying your fair share, if you remember that. stuart: yep. >> so he goes on, the vice president, to say to the baltic people the fact that you occasionally hear something from a presidential candidate in another party, it's nothing that should be taken seriously. stuart: really? not to be taken seriously? >> don't take it seriously, he says, on a trip to the baltic. stuart: he said it and you report it. >> oh, yeah.