Gilead nears deal to buy cancer drug maker for $20bn

Gilead Sciences is close to buying Immunomedics for $20bn, as the pharmaceutical group tries to outbid rivals competing to snap up the cancer drug developer, said people briefed on the matter.

Two people with direct knowledge of the matter warned that the transaction had not yet been definitively agreed and a rival bid could top Gilead’s. 

Gilead’s offer, worth close to double Immunomedics’ market value as of Friday, highlights the drugmaker’s willingness to overpay for takeover targets to secure new assets that can help replenish its portfolio of medicines and boost revenues.

Immunomedics, which is best known for its breast cancer drug Trodelvy, has been eyed by several large pharmaceutical groups in recent weeks, said two people with direct knowledge of the matter, as oncology therapies are some of the most sought after by large players in the sector. 

For Gilead this would be the third blockbuster oncology-focused deal in three years. The company, once the envy of the biotech world for its expensive cure for hepatitis C, which worked out at $1,000 per pill at one point, has been struggling amid greater competition.

Gilead has received renewed attention for remdesivir, a medicine that was once seen as a potential Ebola treatment and is still protected by patents, during the coronavirus pandemic. The drug received emergency approval for treating those who had fallen seriously ill from Covid-19. 

The California-based pharma’s renewed focus on oncology led it to acquire Kite Pharma for $12bn in 2017, adding a cutting edge cancer treatment to its portfolio. It also recently bought Forty Seven, a specialist in drugs that help the body’s own immune system combat a range of cancers, including leukaemia, for $5bn. 

If the deal goes through, Gilead will get access to antibody drug conjugates which aim to use the patient’s own immune system to fight cancer. It would follow in the footsteps of a recent deal between AstraZeneca and the Japanese pharmaceutical Daiichi Sankyo to develop and market an antibody drug conjugate called DS-1062 for lung and breast cancer.

Immunomedics reported a boost to its second-quarter earnings form Trodelvy, which received approval from US regulators in April. The New Jersey-based company said it had made $20.1m in net sales in the two months since the drug was approved. Shares in Immunomedics are up almost 100 per cent year to date. 

Gilead and Immunomedics did not immediately respond to a request for comment. 

The potential deal was first reported by The Wall Street Journal

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