Roche, which dominates the field of breast cancer drugs such as Herceptin, recently won approval for two new treatments, Kadcyla and Perjeta.
San Diego-based Seragon, which was bought by Johnson & Johnson last year, is developing a new generation of oral medicines that it believes offer an improved way of tackling breast cancer, and potentially other cancers.
Its most advanced experimental drug is currently in initial Phase I clinical trials for breast cancer patients who have not responded to current hormonal agents.
However, if successful, the drug, ARN-810, is not likely to hit the market for between six and eight years.
The Basel-based drugmaker will pay $725m in cash and may hand over as much as $1bn more if Seragon achieves drug development milestones.
Seragon’s technology “could one day redefine the standard of care for hormone receptor-positive breast cancer,” said Richard Scheller, head of research and early development at Roche’s Genentech unit.
Roche’s shares in Zurich closed down yesterday 0.26 per cent at SFr263.50.