Gilead hungry for 'don't eat me' cancer biotech: reports

Gilead
Jefferies believes buying Forty Seven makes sense for Gilead Sciences. (Gilead)

A new decade, the same old game: It’s time to play, who will Gilead buy? Sources now says it’s Forty Seven, a cancer-focused startup with a unique MOA.

The alleged target for the Big Biotech is a Stanford University spinout co-founded in 2015 by Irv Weissman, director of the university’s Institute for Stem Cell Biology and Regenerative Medicine, who helped discover that cancer stem cells express CD47, the so-called “don’t eat me” signal, during development.

The biotech’s approach is blocking CD47, which in turn switches off the signals cancer cells use to avoid being attacked by the immune system: i.e., "don’t eat me."

It's been working on this approach ever since, with data out from the American Society of Clinical Oncology a few years ago for its agent 5F9 in combo with other meds showing it could help in a variety of blood and solid cancers.

Whether the biotech wants to be consumed by Gilead, we don’t know. But its shares shot up 33% after-hours on the Bloomberg report, which says it is seeking a takeover, according to people “with knowledge of the matter.”

“Gilead has explored a number of options, including a partnership, said the people, asking not to be identified as the matter is private,” the news wire reported, with the anonymous sources adding that Forty Seven has received interest from other potential suitors as well. Neither company is commenting on the rumors.  

Analysts at Jefferies weighed in last night, saying in a note to clients it sees this potential M&A as part of Gilead’s bolt-on M&A and/or collaboration partnerships for de-risked midstage oncology assets.

“Therefore, we would not be surprised and would view bolt-on assets as a positive given Gilead has significant capital to deploy and needs to continue to build out the pipeline, without needing to spend too much [it spent $12 billion on CAR-T biotech Kite Pharma a few years back],” the firm said.

“This may be more preferred than paying significant premiums for oncology companies after all the data has played out and/or cancer deals >$8-10B.”