19th Mar 2024 18:39
(Alliance News) - AstraZeneca PLC on Tuesday continued its recent shopping spree, this time announcing a deal worth around USD2 billion to acquire Fusion Pharmaceuticals Inc.
AstraZeneca will buy all Fusion shares for around USD21.00 per share in cash plus a non-transferable contingent value right of USD3.00 per share in cash payable upon achievement of a specified regulatory milestone.
The upfront cash portion represents a value of around USD2 billion, a 97% premium to Fusion's closing market price of USD10.64 on Monday. AstraZeneca added that the deal is worth up to USD2.4 billion, including the maximum potential contingent value payments.
The Cambridge-based pharmaceutical company said the takeover will boost its ambition to transform cancer treatment and outcomes for patients by replacing traditional regimens like chemotherapy and radiotherapy with more targeted treatments.
AstraZeneca expects the takeover, which is subject to customary closing conditions, to close in the second quarter of 2024. Fusion will become a fully-owned subsidiary of AstraZeneca with operations continuing in Canada and the US.
AJ Bell analyst Danni Hewson commented: "AstraZeneca has been splashing the cash over the past week, spending USD3.5 billion on two companies to fill its ever-important pipeline of treatments that will drive earnings in the future. Drug companies have learned their lesson from patent cliffs that they cannot rely on blockbuster treatments forever. They need to keep the pipeline stocked up, acting like a conveyer belt so something else comes along just as an existing treatment loses patent protection and earnings fall victim to generic copycats.
"And Fusion gives AstraZeneca a buy in to a market that's already being explored by its competitors. The pharma giant will have kicked the tyres thoroughly to ensure its new acquisition works alongside its existing operations, harnessing knowledge and techniques that can be further exploited. Medicine is constantly evolving and today's patient is hyper aware of the next big development that could make their treatment more successful and less invasive."
Last week Thursday, Astra struck a USD1.05 billion deal to acquire Amolyt Pharma SAS, strengthening its late-stage rare disease pipeline.
In December, it announced the acquisitions of Icosavax Inc and Gracell Biotechnologies Inc. Both deals were sealed last month.
By Eric Cunha, Alliance News news editor
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