Bristol-Myers Squibb (BMS) has jumped on this year’s high-priced acquisition bandwagon, offering to pay $2.4 billion for Medarex. The deal pads BMS’ biologics capabilities and adds royalties from marketed products plus investigational candidates and two discovery and development platforms.
“Medarex’s technology platform, people, and pipeline provide a strong complement to our company’s biologics strategy, specifically in immune-oncology,” notes James M. Cornelius, chairman and CEO, BMS. “With its productive and proven antibody discovery capabilities, ability to generate interesting therapeutic programs, and unique set of preclinical and clinical assets in development, Medarex represents what we’re looking for.”
BMS says that it will pay $16 per share in cash. This represents an 88.8% premium over Medarex’ closing price yesterday of $8.40. BMS says that it will finance the acquisition from its existing cash resources. The companies expect the tender offer to close in approximately 30 days after commencement of the tender offer.
With this takeover, BMS will earn royalties from the sale of three drugs that were developed on Medarex’ platform and subsequently out-licensed: Simponi, marketed by Centocor Ortho Biotech for moderate to severe active rheumatoid arthritis in combination with methotrexate, active psoriatic arthritis alone or with methotrexate, and active ankylosing spondylitis; Centocor’s Stelara for psoriasis; and Novartis’ Ilaris for cryopyrin-associated periodic syndromes. Simponi is approved in Canada and the U.S., Stelara in Canada and Europe, and Ilaris in the U.S.
All three drugs were developed on Medarex’ UltiMAb Human Antibody Development System®. It produces high-affinity, fully human antibodies for use in a range of therapeutic areas including immunology and oncology. Along with UltiMAb BMS will also obtain Medarex’ next-generation antibody-drug conjugate technology.
Additionally Medarex has seven fully owned antibodies in clinical trials and three antibodies being evaluated through partnerships. BMS thus gains full rights to the lead candidate, ipilimumab, which was being developed under a profit-sharing arrangement with the firm. This immunotherapy is currently in Phase III for the treatment of metastatic melanoma. The companies also have an ongoing Phase II study in lung cancer and Phase III trials in adjuvant melanoma and hormone-refractory prostate cancer.
Medarex’ collaborations include two compounds in Phase II development in lupus and autoimmune diseases with AstraZeneca, a Phase I program in cancer and hepatitis C with Ono Pharmaceutical, and an anthrax therapeutic candidate in a Phase I study with PharmAthene.
Medarex also has an equity interest in Genmab, which has filed a BLA and MAA for Ofatumumab in chronic lymphocytic leukemia and rheumatoid arthritis. Additionally, the company has a co-development agreement with Merck & Co. that covers MDX-066 and MDX-1388 being developed as a drug against C. difficile infection.