TOKYO: Japan’s Astellas Pharma said on Monday it agreed to buy United States drugmaker Iveric Bio Inc for about 5.9 billion dollars in its biggest acquisition, giving it access to the range of ophthalmology treatments.
The deal marks the fifth leading overseas acquisition by Astellas, Japan’s third-biggest drugmaker by sales, since 2019 in the push to shore up its pipeline as its leading sellers lose patent protection.
Astellas stance
Astellas said that through Berry Merger Sub Inc, a wholly-owned subsidiary of Astellas United States Holding, the Japanese entity agreed to acquire Iveric for $40 per share in cash. The price is a 22 per cent premium to Iveric’s 32.89 dollars closing price on April 28.
New Jersey-based Iveric, previously branded as Ophthotech, is focused on developing treatments for retinal diseases. The Astellas company’s key asset is avacincaptad pegol, currently in trial stage for treating geographic atrophy, the higly advanced stage of macular degeneration, the common cause of vision loss in the elderly.
Avacincaptad pegol, branded as Zimura, targets the C5 protein suspected of causing the growth of scarring associated with the disease. The US Food and Drug Administration granted a priority review of Avacincaptad pegol; if approved, a treatment can be commercialised by the end of this year.
Chief executive Naoki Okamura said that along with treatments for menopause symptoms and bladder cancer, Astellas company is counting on Avacincaptad pegol to make up for the loss of sales exclusivity of its main prostate cancer drug Xtandi.
Okamura said, “We believe this is going to be the third pillar,” who ascended to the top job the previous month. Astellas has been chasing acquisitions, announcing deals in late 2019 to buy
United States biotech Xyphos Biosciences for up to 665 million dollars and Audentes Therapeutics Inc for about 3 billion dollars. Its track record on acquisitions is mixed, as the company had to book significant impairments on Audentes.
Jefferies analysts said in the note on the Iveric acquisition, “This deal is about a soon-to-be approved asset; seems less likely to generate impairment losses,”
Astellas would fund the Iveric purchase through short-term loans and commercial paper amounting to about 800 billion yen. Astellas shares gained 1.8 per cent in Tokyo trading, outperforming a 0.7 per cent advance in the benchmark Nikkei gauge.
