AbbVie Agrees to Buy Stemcentrx

abbvie.png

April 28, 2016

Pharmaceutical company AbbVie Inc. has agreed to acquire Stemcentrx Inc., a cancer-drug developer, for $5.8 billion. This is part of AbbVie’s continuing aggressive push for building an oncology business.

AbbVie gains Stemcentrx’s experimental treatment for a form of lung cancer, plus other experimental drugs. It also involves cash-and-stock acquisition, which includes potential additional payments of up to $4 billion if certain drug-development goals are hit,

According to AbbVie, the lung-cancer treatment, dubbed Rova-T, has sales potential of multi-billion-dollars. This is based on clinical trials which showed that Rova-T shrank lung tumors in a significant portion of patients receiving it. It would also expand AbbVie’s cancer-drug lineup beyond those for blood cancers, to include treatments for tumors in solid organs.

AbbVie Chief Executive Richard Gonzalez said: “We’re impressed with this. We think Rova-T is a very good asset and gives us a strong position on solid tumors going forward.”

In an attempt to reduce its heavy dependence on the anti-inflammatory drug Humira, AbbVie has reached this agreement, which is the latest in a series of deals the company has struck. This is important for a company which will face potential competition from copycat drugs in coming years. AbbVie hopes the drug could reach the market in 2018 if it is approved by regulators.

As said by J.P. Morgan analyst Chris Schott, the deal “brings the company an interesting late-stage asset in small-cell lung cancer with the potential for much broader usage over time.”

 

Advertisements

One thought on “AbbVie Agrees to Buy Stemcentrx

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s