UPDATED: AstraZeneca buys Spirogen in $440M deal, inks pact in armed antibody double-play

AstraZeneca ($AZN) has struck a deal to buy one antibody-drug conjugate developer for up to $440 million while making a $20 million equity bet on another as it continues a global biotech shopping spree to stock its pipeline of cancer drugs.

AstraZeneca's biologics player in Gaithersburg, MD, MedImmune, agreed to pay $200 million in cash to buy the U.K.'s Spirogen, committing up to $240 million in milestones for the company. And it invested $20 million in Switzerland's ADC Therapeutics while executing a licensing deal for two programs that include an undisclosed upfront and milestones. Auven Therapeutics, the majority owner of both Spirogen and ADC Therapeutics, matched the equity investment, bringing the total to $40 million.

Antibody-drug conjugates--or "armed" antibodies--promise to deliver highly toxic payloads right to their cancer target, allowing the developers to steer clear of healthy tissue and more effectively obliterate cancer from patients. The field entered the commercial spotlight with Roche's ($RHHBY) blockbuster Kadcyla, developed with conjugate technology from ImmunoGen ($IMGN).

Auven Therapeutics was founded by Stephen Evans-Freke and Dr. Peter Corr, who have been assembling a portfolio of biologics and small molecules at the company's base in Lausanne, Switzerland. Evans-Freke's Celtic Therapeutics committed $50 million to launch ADC Therapeutics about a year and a half ago. Samuel Broder, the former director of the U.S. Cancer Research Institute, and Barrie Ward, the former CEO of kuDOS, stepped in as advisers.

Through the buyout, MedImmune gets Spirogen's proprietary pyrrolobenzodiazepine (PBD) technology, DNA binding agents that can ferret out cancer cells and delivery targeted cytotoxic payloads, CEO Chris Martin told FierceBiotech. Spirogen's technology is orders of magnitude more potent than first-generation ADCs, Martin said, allowing the agents to maintain their effectiveness in resistant cells.

"We see (MedImmune) as one of the global leaders in terms of antibody engineering," Martin said. "With their pipeline of targets and the exquisite potency of PBD, we have the potential to create a large and very competitive portfolio of ADC programs."

Spirogen has been developing the technology for more than a decade and is still at work expanding the chemistry platform, Martin said. PBD's promise has lured the likes of Seattle Genetics ($SGEN) and Genentech into collaborative deals, and Spirogen has two programs of its own in Phase I, Martin said.

As for AstraZeneca, the star-crossed drug giant is again looking to M&A to make up for bad bets and a stilted pipeline. The Spirogen deal follows a $500 million bet on the oncology-focused Amplimmune, $443 million spent on cardio drug outfit Omthera and billions shelled out to absorb Pearl Therapeutics and collaborate with FibroGen. And that's just this year. But the drugmaker still has a long way to go in convincing investors that the worst of its R&D mishaps are in the rearview, and that'll take promising late-stage therapies, not just a big checkbook.

- here's the release