Amgen to acquire Onyx in $10 bn deal

Deal gives Amgen access to expanding cancer care market

Amgen employs about 250 people in Dublin in two sites in Dun Laoghaire andSantry.

Amgen employs about 250 people in Dublin in two sites in Dun Laoghaire andSantry.

 

US pharmaceutical group Amgen is to acquire Onyx Pharmaceuticals in a $10.4 billion (€7.8bn) deal that gives Amgen access to a rapidly expanding cancer market with a new product that offers sure revenue.

Amgen agreed to pay $125 a share for Onyx’s outstanding stock. Onyx’s Kyprolis, approved last year for a rare blood cancer, may spur more than $3 billion in revenue by 2021, according to analyst estimates . Onyx is now studying the medicine in an expanded group of patients. The accord mirrors recent deals in which drugmakers have focused on buying companies with one or two promising products, rather than attempting large mergers that come with whole pipelines or offer business synergies. Onyx’s oncology drug fills a hole for Amgen in a product line that largely contains drugs to support, rather than treat, cancer patients at a time when the oncology market is growing increasingly important as the result of an aging US population.

The Onyx agreement offers “a unique opportunity to add value to Kyprolis, a product which is at an early and promising stage of its launch,” said Robert Bradway, chief executive officer for Thousand Oaks.

The next buyout within the drug industry could involve Alexion Pharmaceuticals, another single-product company whose blood-disease treatment Soliris generated $1.1 billion in sales last year as one of the world’s most expensive medicines. Alexion has engaged Goldman Sachs as an adviser as it prepares for a possible takeover offer from Roche Holding.

Amgen’s deal for South San Francisco-based Onyx follows similar agreements featuring the takeover of a small number of already-marketed or late-stage experimental drugs. Last year, for example, Bristol-Myers Squibb bought Inhibitex and Amylin Pharmaceuticals to gain individual treatments for diabetes and hepatitis C. The chief executives for both Pfizer and Merck have said this year that they prefer similar “bolt-ons,” rather than mergers that come with a slate of products.

Bloomberg