Gilead Sciences, Inc. (NASDAQ: GILD) kicked off this week with a multi-billion acquisition of Immunomedics (NASDAQ: IMMU). The pharmaceutical giant reached an agreement to buy Immunomedics for $21 billion, or $88 per share, a 108% premium to Immunomedics’ closing price on September 11, 2020. Immunomedics generated trailing 12-month revenues of $20.37 million. The deal will be funded through approximately $15 billion in cash on hand, as well as approximately $6 billion in newly issued debt.
Immunomedics is a leader in next-generation antibody-drug conjugate (ADC) technology focused on researching therapeutics for hard-to-treat cancers, and is most known for its product Trodelvy, an ADC indicated for the treatment of adult patients with metastatic triple-negative breast cancer (mTNBC) who have received at least two prior therapies for metastatic disease. This indication was granted accelerated approval by the FDA based on tumor response rate and duration of response.
Gilead is looking to use Trodelvy to boost its oncology portfolio and will initiate numerous additional mid- and late-stage studies in the near term to determine which patients will benefit from the product. Gilead will also bring to Immunomedics an established infrastructure and operations in Europe and Japan to support the launch of Trodelvy in those regions, pending approval. After closing, Gilead will retain global rights to Trodelvy outside of greater China, South Korea and certain Southeast Asian countries.
The takeover of Immunomedics isn’t Gilead’s first step into the oncology market, based on a search of the data in Deal Search Online. Back in May, Gilead signed a 10-year partnership agreement to co-develop and co-commercialize next-generation cancer immunotherapy with Arcus Biosciences (NYSE: RCUS). The agreement gave Gilead access to Arcus’s current and future investigational immuno-oncology products.
In March, Gilead bought Forty Seven, Inc. (NASDAQ: FTSV), a clinical-stage immuno-oncology company, for $4.9 billion, or $95.50 per share in cash. Forty Seven’s lead program, magrolimab, is a monoclonal antibody against the CD47 receptor, a “don’t eat me” signal that cancer cells commandeer to avoid being ingested by macrophages. This acquisition aimed to strengthen Gilead’s immuno-oncology research and development portfolio.