UPDATE 1-Astellas sets hostile bid for CV Therapeutics

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Feb 27 (Reuters) - Astellas Pharma Inc (4503.T: Quote, Profile, Research), Japan's second-largest drugmaker, launched a hostile $1 billion bid for biotech firm CV Therapeutics CVTX.O after the U.S. firm rejected its buyout offer.

Astellas needs new products to counter the impact of patent expiries on key products such as its prostate drug Flomax, and Vesicare for over-active bladder.

"While we continue to prefer to reach a negotiated agreement with CV Therapeutics' Board, their refusal to engage with us regarding our proposal has left us with no alternative but to take our offer directly to CV Therapeutics' stockholders," Astellas said in a statement on Friday.

Astellas's cash offer of $16 per share was at a 41 percent premium to CV's closing price on Jan 26, the last day of trading before the proposal was made public. CV's shares closed at $15.86 on Thursday.

CV Therapeutics said last week it had sent a letter to Astellas, saying the buyout proposal undervalued CV and its growth potential. [ID:nBNG435146]

CV Therapeutics turned down a similar offer by Astellas in November.

Astellas said the $16 per share offer is due to expire on March 27. It said it is considering taking action in connection with CV Therapeutics' 2009 annual meeting.

Shares of Astellas closed at 3,290 yen on Friday. (Reporting by Ajay Kamalakaran in Bangalore; Editing by Anshuman Daga)