Cephalon continues buyout spree with $163M ChemGenex deal
Just a week after striking a deal to buy out Gemin X for up to $525 million, Cephalon ($CEPH) is continuing its buyout spree with yet another acquisition of a small cancer drug developer with a late-stage product in hand.
Cephalon will shell out about $163 million to acquire all the outstanding shares of ChemGenex. The deal values the biotech at about $225 million. Shares of Australia's ChemGenex Pharmaceuticals raced up more than 50 percent after investors got wind of Cephalon's newly forged pact to buy out the cancer drug developer.
The key to ChemGenex's value is Omapro, a new drug for chronic myeloid leukemia that has wrapped Phase III and is poised to head to the FDA for a possible approval later in the year. "The proposed transaction allows ChemGenex shareholders to realize cash proceeds at a significant premium to recent trading levels and adds an interesting late-stage opportunity to our portfolio," said Cephalon CEO Kevin Buchi.
ChemGenex has presented data demonstrating Omapro's ability to inhibit protein translation of short-lived oncoproteins that are up-regulated in leukemic cells. Investigators also have reviewed pre-clinical research showing that omacetaxine kills human CML stem cells.