AstraZeneca PLC (LSE:AZN) is acquiring clinical-stage oncology group Fusion Pharmaceuticals in a $2.4 billion (£1.9 billion) deal.
At a price of $21 per share, the offer represents a 126% premium to Nasdaq-listed Fusion’s last closing price.
AstraZeneca will pay $2 billion upfront at that price, followed by a contingent $3 per share “upon the achievement of a specified regulatory milestone”.
Fusion specialises in developing next-generation radioconjugates (RCs), which the FTSE 100 group said will further boost its strength in oncology.
Its most advanced programme, FPI-2265, is a RC that is a potential new treatment for patients with metastatic castration-resistant prostate cancer (mCRPC), and is currently in a Phase II trial.
Lacking its own internal 'radiopharma' pipeline, AZ had been collaborating with Fusion on certain drug targets, including on the FPI-2068 drug programme, an EGFR-cMET targeted radioconjugate into Phase I clinical trials.
Susan Galbraith, oncology R&D chief at the Anglo-Swedish pharma giant, said: "Between thirty and fifty per cent of patients with cancer today receive radiotherapy at some point during treatment, and the acquisition of Fusion furthers our ambition to transform this aspect of care with next-generation radioconjugates.
“Together with Fusion, we have an opportunity to accelerate the development of FPI-2265 as a potential new treatment for prostate cancer, and to harness their innovative actinium-based platform to develop radioconjugates as foundational regimens."
The transaction is expected to close in the second quarter of 2024.
Shares in AstraZeneca fell 1% to 10,190p after the announcement.