Gilead Gambles On Kite’s Cancer Therapy, Scooping Up Drugmaker In $11B Deal
The move is a departure from the path currently being followed by the pharmaceutical industry where the pace of acquisitions had largely slowed this year.
The New York Times:
Gilead To Buy Kite, Maker Of Cancer Treatments, For $11.9 Billion
The drugmaker Gilead Sciences said on Monday that it would buy Kite Pharma for about $11.9 billion to bolster its aging portfolio with an emerging cancer treatment. The acquisition, Gilead’s first major deal since 2011, is a departure from the path followed by the broader pharmaceutical industry, where — apart from Johnson & Johnson’s $30 billion takeover of the Swiss biotechnology company Actelion — the pace of acquisitions had largely slowed this year. Many drugmakers that had been busy with takeover activity in recent years have since been at work integrating their purchases. (de la Merced, 8/28)
The Wall Street Journal:
Gilead Bets $11 Billion On New Cancer Therapy
Doctors say Kite’s main treatment, which is up for regulatory approval in the U.S. and Europe, could drastically improve treatment of patients with some of the most advanced cases of cancer. EvaluatePharma expects Kite’s therapy to generate sales of $1.7 billion world-wide in 2022. “This technology is really going to be transformative to the field,” Gilead CEO John Milligan said in an interview. (Rockoff and Roland, 8/28)
Gilead Tries To Repeat Home Run With $11.9 Billion Kite Deal
The acquisition will pivot Gilead away from the antiviral treatments that have been the backbone of its business since at least 2001, to a cancer therapy that’s promising but has no commercial track record -- and plenty of risks. It’s a bet the company has made before. More than five years ago, Gilead made a $10.8 billion deal for Pharmasset and a then-experimental hepatitis C treatment, a purchase criticized by some at the time as too expensive. Once on the market, the medicine became the fastest-selling drug in the world. Gilead is now hoping Kite’s cancer technologies have similar potential. (Chen, Cortez and Hopkins, 8/28)
How Can Gilead Make The Kite Deal Work? Here's What The Wags Say ...
Here is what the Wall Street wags are saying: Needham analyst Alan Carr sums up the prospects this way: “The Kite transaction creates an opportunity for Gilead to become an important player in oncology and may be transformational in the long-term, but there is enough uncertainty around the technology and the competitive landscape that it is unclear whether Gilead will emerge a long-term leader in oncology,” he wrote to investors. “Factors for success include retention and leverage of Kite personnel and expertise to explore T-cell technologies beyond hematology, including solid tumor.” (Silverman, 8/28)
In other pharmaceutical news —
The Associated Press:
New Drug Reduces Heart Attacks, But Is That Enough?
So-so results for a new type of cholesterol drug have left Merck in a quandary: Does the company try to bring it to market or scrap it? A large, long-term study of the drug showed that it prevents heart attacks and reduces the need for heart procedures, while three similar drugs developed by rivals failed. But the drug, anacetrapib, only reduced those complications by 9 percent. (Johnson, 8/29)