Amgen pushes into Asia oncology market with $1.9 billion Five Prime buy

(Reuters) – Drugmaker Amgen Inc is buying Five Prime Therapeutics for about $1.9 billion and adding a late-stage gastric cancer drug candidate to its line of cancer treatments, the companies said on Thursday.

FILE PHOTO: An Amgen sign is seen at the company’s office in South San Francisco, California October 21, 2013. REUTERS/Robert Galbraith

The deal comes as Amgen looks to expand in the oncology market in Asia-Pacific region, where gastric cancer is more prevalent.

It gained a toehold in China in 2019 through a 20.5% stake in Chinese cancer drugmaker BeiGene Ltd for nearly $3 billion.

Through the latest deal, Amgen will get access to Five Prime’s lead drug candidate, bemarituzumab, which is ready to enter a late-stage study for treating advanced gastric cancer.

“While gastric cancer may be a small market in the United States, it could provide a significant opportunity in Asia”, Truist Securities analyst Robyn Karnauskas said.

Amgen will also get a royalty share on future sales of bemarituzumab in China, where Five Prime has a marketing and development deal with Zai Lab Ltd.

The treatment had shown improved overall survival and reduced risk of gastric cancer progression in a mid-stage study.

Bemarituzumab works by targeting a gene called FGFR2b, which when mutated may cause the overexpression of a protein involved in cell division.

More:  Fiat Chrysler does not see delay in PSA merger, FIOM union says

The treatment is an addition to Amgen’s two other gastric cancer drug candidates, AMG 910 and AMG 199, which are in early-stage trials.

Amgen will pay $38 per Five Prime share, representing a premium of nearly 79% to the company’s last closing price of $21.26.

Five Prime shares surged 78% and Amgen added 0.6% in early trading.

Reporting by Manojna Maddipatla in Bengaluru; Editing by Arun Koyyur


More from: | Category: M&A News