Amgen to acquire Abgenix for $2.2 billion

By Angela McDaniels

Seattle, Dec. 14 - Amgen and Abgenix Inc. said they have signed a definitive merger agreement under which Amgen will acquire Abgenix for $2.2 billion in cash plus the assumption of debt. Abgenix shareholders will receive $22.50 in cash per common share.

The acquisition is expected to close by the end of the first quarter of 2006 and is subject to approval by Abgenix's shareholders and regulatory authorities.

Amgen expects dilution of adjusted earnings per share in 2006 and 2007 in the range of $0.05 to $0.10, with the acquisition seen as accretive after that.

The transaction includes Abgenix's 100,000-square-foot manufacturing plant and Abgenix assets, such as the ownership and capabilities of the proprietary fully human monoclonal antibody technology XenoMouse.

The acquisition eliminates a tiered royalty that Amgen would have paid to Abgenix on future sales of denosumab, which was created using Abgenix's XenoMouse antibody technology, the companies said.

Full ownership of panitumumab

Further, the acquisition of Abgenix provides Amgen with full ownership of advanced pipeline product panitumumab. Working closely with Abgenix under a co-development agreement that Amgen assumed as a result of its acquisition of Immunex Corp. in 2002, Amgen has led the development and commercialization strategy for panitumumab.

Amgen and Abgenix believe panitumumab has substantial commercial opportunity, including potential in the first-line treatment of metastatic colorectal cancer in combination with other agents, including anti-angiogenic therapies.

Panitumumab is the first epidermal growth factor receptor inhibitor to demonstrate a statistically significant improvement in progression-free survival for metastatic colorectal cancer patients who have failed standard chemotherapy, the companies said. It is also the first fully human monoclonal antibody in cancer clinical trials that targets the epidermal growth factor receptor.

Amgen believes potential peak worldwide sales for panitumumab could reach $2 billion or more, assuming the success of panitumumab in several clinical trials evaluating multiple lines of therapy in colorectal cancer and head and neck cancer.

Later this week, Amgen and Abgenix expect to initiate a Biologics License Application for the treatment of metastatic colorectal cancer patients who have failed standard chemotherapy.

"Combining with Amgen provides an attractive valuation for our shareholders. We believe this transaction will allow us to advance panitumumab to its full potential for patients and to maximize the value of both Abgenix's growing portfolio of antibody product candidates and our exceptional scientific platform," Abgenix president and chief executive officer Bill Ringo said in a company news release.

"We have worked closely with Amgen for many years and are very excited about combining Abgenix with the leader in the biotech industry."

Amgen, the world's largest biotechnology company, is based in Thousand Oaks, Calif., and develops human therapeutics.

Abgenix is a biopharmaceutical company based in Fremont, Calif. that develops and manufactures fully human therapeutic antibodies.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.