Otsuka to acquire Astex Pharmaceuticals for $886 million

Transaction gains Otsuka a drug discovery platform and several oncology drug candidates

Kelsey Kaustinen
TOKYO—Otsuka Pharmaceutical Co. Ltd. and Dublin,Calif.-based Astex Pharmaceuticals Inc., which discovers and develops novelsmall-molecule therapeutics and has a special focus in oncology, have announcedthat Otsuka will be acquiring all outstanding shares of Astex stock for $8.50per share in cash, a 48-percent premium compared to the average closing stockprice for Astex for the prior 30-day period. Both companies' boards ofdirectors unanimously approved the transaction. All told, the transaction has afully diluted equity value of roughly $886 million, and Otsuka plans to enactthe acquisition through a tender offer. The deal is subject to customaryclosing conditions, and is expected to close early in the fourth quarter ofthis year.
 
"We believe that Otsuka's financial resources anddevelopment expertise will enhance Astex's ability to build further itsoncology portfolio, pipeline and discovery prowess," James S.J. Manuso, Ph.D.,chairman and CEO of Astex, said in a press release. "This transaction recognizesthe meaningful assets our employees have created. Most importantly, however,patients will benefit substantially from the larger drug discovery, developmentand commercialization platform a combined Otsuka and Astex will deliver."
 
 
This acquisition will bolster Otsuka's pipeline withtherapeutic candidates in oncology, neuroscience and cardiovascularindications, as well as PYRAMID, Astex's drug discovery platform, which, as thecompany explains on its website, "integrates biophysical techniques, such asX-ray crystallography, nuclear magnetic resonance spectroscopy and calorimetry,with fragment library design and a range of computational methodologies."
 
 
Astex's pipeline includes drug candidates for a variety ofcancers, including prostate, lung, ovarian, liver and acute myeloid leukemia.Its oncology compounds feature inhibitors of HSP90, DNMT, CDK, JAK/Aurora andAGC kinase. Among these, SGI-110 is its most developed candidate, a novel andpotential best-in-class subcutaneous hypomethylating agent under evaluation forthe treatment of myelodysplastic syndromes, acute myeloid leukemia, ovariancancer and liver cancer. Astex's marketed products include its DACOGEN(decitabine) for injection, for the treatment of myelodysplastic syndromes.Recently, DACOGEN gained approval in Europe for treating elderly acute myeloidleukemia in patients over 65 years.
 
 
"I hope that this acquisition of Astex will strengthen notonly our cancer portfolio but also our drug discovery research in the centralnervous system field, through the acquisition of Astex's fragment-based drugdesign technology at its Cambridge, England research headquarters and itsCalifornia clinical oncology R&D department," Dr. Taro Iwamoto, presidentand representative director at Otsuka, commented in a statement regarding thedeal. "Astex's unique fragment-based drug discovery technology and clinicaloncology research and development capabilities, born out of the passion of itsresearchers, exemplify our corporate mottos and belief in 'Sozosei (Creativity)and Jissho (Proof through Execution).' I would like Otsuka Pharmaceutical tocontinue to respect Astex's uniqueness and leverage it to bring further growthfor Otsuka Pharmaceutical."
 
 
Astex brought on Jefferies LLC as its exclusive financialadvisor for the transaction, with Wilson Sonsini Goodrich & Rosati P.C.serving as its legal counsel. Goldman Sachs was brought on as Otsuka's exclusivefinancial advisor, with Skadden, Arps, Slate, Meagher & Flom LLP serving asits legal counsel.
 
 
 
 
 
 
SOURCE: Otsuka press release

Kelsey Kaustinen

Subscribe to Newsletter
Subscribe to our eNewsletters

Stay connected with all of the latest from Drug Discovery News.

November 2022 Issue Front Cover

Latest Issue  

• Volume 18 • Issue 11 • November 2022

November 2022

November 2022