Astrazeneca invests $2bn in cancer drug tie-up
Astrazeneca has invested $2bn in US pharmaceutical firm Summit Therapeutics as part of a blockbuster cancer research tie-up.
The FTSE 100 drugs giant has agreed to buy 109,000 shares in Nasdaq-listed Summit for $18.36 per share as part of the deal. Shares in Astrazeneca jumped by 1.4 per cent to 12,664p in early trading.
The tie-up will see the two pharma giants collaborate on a series of studies to improve their cancer treatments. Shares in the US drugmaker jumped more than 15 per cent in after-hours trading, following news of the deal.
Dr Maky Zanganeh, co-chief executive of Summit, described the deal as the start of “an exciting new chapter in the advancement” of its new cancer treatments.
The partnership will focus on the development of ivonescimab, a new drug which blocks proteins which help cancer evade the immune system and grow blood vessels.
The treatment, which was licensed by Summit from Chinese drugmaker Akeso, will be trialled alongside Astrazeneca’s cancer medicines as part of the tie-up.
Astrazeneca’s agreement to buy shares in Summit at $18.36 per share represents a 18.6 per cent premium on the US firm’s closing price of $15.48 on Monday.
The deal, which is expected to complete at the end of the week, will give the FTSE 100 company a 12 per cent shareholding of Summit’s outstanding stock.
Tie-up ‘could raise bar for cancer treatment’
Summit’s Zanganeh said: “We look forward to further broadening the development plan of ivonescimab and initiating new clinical trials exploring the potential to combine ivonescimab with promising novel anti-cancer compounds.”
Susan Galbraith, Astrazeneca’s executive vice president of oncology, said the deal “could enable new regimens that raise the bar for patients with cancer across the treatment landscape”.
“AstraZeneca is leading a revolution in oncology with the ambition to provide cures for cancer in every form, following the science to understand cancer and all its complexities to discover, develop and deliver life-changing medicines to patients,” the firm told shareholders on Tuesday.
Last month, Astrazeneca saw its shares shed six per cent in one day after investors baulked at reports that the drugs giant was considering a $400bn megamerger with US rival Bristol Meyers Squibb.
A merger between the companies would create one of the world’s largest pharmaceutical groups but the sell-off signalled concerns over the potential cost and structure of the deal.