Mumbai: Switzerland's Roche Holding AG, the world's biggest maker of cancer drugs, hinted that it may raise its $3-billion hostile takeover bid for US diagnostics maker Ventana Medical Systems Inc. after the Ventana board rejected the offer.(See: Roche makes hostile offer for Ventana ) In a letter to Ventana chairman Jack Schuler, Roche CEO Franz Humer described the offer as ``full and fair'' but left open the door to a compromise.

The board of Arizona-based Ventana Medical Systems Inc rejected Roche Holding's $3- billion offer, accusing the Swiss bidder of trying to snatch value from investors. Ventana advised shareholders to hold onto the stock.

"Roche is attempting to obtain for itself unique strategic value and synergies that we believe would accrue to the broader pharmaceutical industry and Ventana's stockholders over the near and long term," Ventana chairman Jack Schuler said in a statement.

Roche, after failing to engage Ventana in negotiations, launched an unsolicited bid for Ventana earlier this month, offering investors a 45-per cent premium to the stock's previous day's closing price.

Investors, meanwhile, bet on a sweetened offer from Roche, which wanted Ventana to broaden its diagnostic products and complement its in vitro diagnostic systems and oncology therapies.

Ventana investors expected Roche to bid up to $80.25, well above the $75 it offered.

Roche, in its offer, has also challenged Ventana's rules that allowed shareholders to buy half-price shares, as well as Arizona state laws that prevented Roche from exercising any voting rights accrued in a hostile bid.

Ventana, which has 950 employees on its payrolls, specialises in testing body tissues - a $1 billion business in the US. Ventana had sales of $238.2 million last year.

The takeover would give Roche a test to identify patients who may respond to Herceptin, the breast-cancer treatment that is the Swiss company's No. 2 drug. Herceptin had $1.2 billion in sales last year.

With a majority stake in Genentech, Roche already has a strong position in biotechnology. Acquiring Ventana would help it build on its diagnostics presence, where it currently has in-vitro, molecular and clinical chemistry diagnostic products.

The acquisition would also give it access to technology that helps researchers and doctors better select the right drugs for individual patients - an emerging concept known as personalised medicine Proponents of personalised medicine say it could reduce the costs and risks of developing drugs.

The deal would dilute Roche's share capital by about 1 per cent and would add to earnings in two to three years.

Roche has sued Ventana and the Arizona attorney general over a state law that could derail its bid for the US company.

The Swiss drugmaker has also challenged in Wilmington, Delaware, a defence Ventana adopted that would give its existing shareholders rights to buy new stock at half price.

If Roche wins the cases, analysts say, it may ultimately be able to take over the company albeit at a sweetened offer price. (See: Roche goes to court over Ventana's poison-pill defence )

The bid is Basel-based Roche's fourth this year of companies with screening tools that help doctors adjust treatment to a patient's genetic profile.

In March, Roche agreed to buy CuraGen Corp.'s 454 Life Sciences for $140 million in cash to gain the company's DNA- mapping technology and in April, it offered to spend $600 million for acquiring BioVeris Corp. Again, last month, the company agreed to buy NimbleGen Systems Inc. for $272.5 million.

Merrill Lynch & Co. and Goldman, Sachs & Co. are providing financial advice toVentana, while Sidley Austin LLP and Snell & Wilmer LLP are advising Roche.