That's No Way to Make Friends

Sanofi-aventis (NYSE: SNY  ) has gone hostile. Bypassing Genzyme's (Nasdaq: GENZ  ) board, the French drugmaker has offered $69 per share directly to Genzyme's shareholders.

Yawn.

Only investors who haven't completed first grade -- where you learn greater than and less than signs -- would actually tender their shares. They could currently sell on the open market and make $2 and some change more than tendering them to Sanofi.

But the tender offer serves as additional ammunition that Sanofi hopes Genzyme's investors will use to put pressure on Genzyme's management to sit down at the negotiating table. Sanofi's bear hug letter certainly didn't do much to move the sides closer.

Personally, I think Genzyme is playing this pretty well. Sanofi needs Genzyme more than the other way around. Sanofi's Lovenox began to see generic competition from Novartis (NYSE: NVS  ) and Momenta Pharmaceuticals (Nasdaq: MNTA  ) a few months ago, and just last week, a court threw out patents on Taxotere, clearing the way for a launch of a generic by Hospira (NYSE: HSP  ) . Add Plavix to the soon-to-be-generic list -- it's the second-best-selling drug in the world, although Sanofi shares revenue with Bristol-Myers Squibb (NYSE: BMY  ) -- and it's pretty clear Sanofi needs some help.

But that isn't to say you should run out and buy Genzyme at these inflated prices either. Just because Sanofi needs to add revenue and Genzyme would be a nice addition doesn't mean Sanofi is willing to play at the price Genzyme thinks is reasonable. The two could just butt heads for a while longer before Sanofi walks away, or Sanofi could up its tentative bid and walk away after it finally gets a look at Genzyme's non-public information. The latter seems like a distinct possibility, considering that Genzyme hasn't exactly been firing on all cylinders lately.

If Sanofi walks and another buyer can't be found, investors aren't likely to slap a $70 price tag on Genzyme until management proves that it can actually turn things around.

David Gardner wraps up the "11 O'Clock Stock" series with another not cheap but worth it stock.