AstraZeneca, the UK’s second-largest drug maker, has taken a further step towards boosting its pipeline of new cancer treatments by agreeing to buy privately-owned US biotech company Amplimmune for up to $500 million (£320.9m).
The deal came the day after US rival Amgen unveiled the $10.4 billion acquisition of Onyx Pharmaceuticals, which also specialises in cancer drugs.
Maryland-based Amplimmune was founded in 2007 and develops treatments to help patients’ immune systems fight cancer, and its purchase will give AstraZeneca access to a number of compounds currently in pre-clinical development.
Under the terms of the agreement, AstraZeneca’s MedImmune subsidiary, which is also headquartered in Maryland, will pay an initial $225m for Amplimmune, followed by a further payment of up to $275m depending on development milestones. The acquisition is subject to regulatory approval and is expected to complete during the third quarter of the year.
Executive vice-president Bahija Jallal said: “MedImmune’s focus on harnessing the power of the patient’s own immune system to fight cancer will be complemented by Amplimmune’s innovative work in this area. It will allow us to strengthen our arsenal of potential cancer therapies.”
Amplimmune’s president and chief executive, Michael Richman, added: “Both companies are passionate about developing new cancer therapies for patients and are excited about the potential of immunotherapies.”
The new wave of medicines that harness the power of the immune system to combat cancer could become the biggest class of drugs in history, with potential sales of $35bn a year, according to analysts at Citigroup. Cancer claims more than seven million lives a year and that figure is forecast to rise to 12 million by 2030.
AstraZeneca chief executive Pascal Soriot, who took the helm in October after joining from Swiss rival Roche, has identified oncology as a key area for investment and the group has other therapies in development that seek to use the immune system to eradicate cancer cells.
Amplimmune’s product pipeline includes a treatment being developed in partnership with GlaxoSmithKline – the UK’s largest drug maker – that aims to overcome the suppression of the immune system caused by many cancers and infectious diseases.
Yesterday’s deal came just hours after Amgen struck a $10.4bn cash deal to buy Onyx, its largest acquisition since the $16bn purchase of Immunex, a maker of asthma and arthritis treatments, in 2001.
Large pharmaceutical companies have increasingly been looking to snap up smaller biotech firms to gain access to new drugs, as they face significant revenue losses as patents expire.
Earlier this month, AstraZeneca blamed expiring patents and higher tax charges for a 10 per cent fall in second-quarter core operating profits, to $2bn.
The purchase of Onyx, which should complete by the end of the year, is expected to raise Amgen’s profile in the field of oncology, as many of its drugs offer supportive care for cancer patients, such as treating anaemia or decreases in white blood cells caused by chemotherapy.
The firm also makes two cancer drugs through a partnership with German group Bayer, including Nexavar, a pill that has been approved to treat liver and kidney cancer, which generated sales of $861m last year.
Amgen chairman and chief executive Robert Bradway said: “Our acquisition of Onyx follows a thorough due diligence process and is fully consistent with our strategy of advancing innovative medicines that address serious unmet medical needs.”